May - June 2013

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Contents

15

6 PUBLISHER’S LETTER Emerging Technologies

By Jack Trlica

Facial Recognition: A Game-Changing Technology for Retailers

8 10

ON THE WEB RETAIL SPONSORS

12 INTERVIEWING General Loss Interviewing—Part Two

By David E. Zulawski, CFI, CFE and Shane G. Sturman, CFI, CPP

The potential good and bad of this emerging technology

By Chris Trlica, Contributing Writer

26 ACADEMIC VIEWPOINT Is It Time for a Paradigm Shift in LP Technology?

By Richard C. Hollinger, Ph.D.

29

38 EVIDENCE-BASED LP How Protective Countermeasures Actually Work

By Read Hayes, Ph.D., CPP

Asset Protection in a ConvenienceStore Envirnoment

48 MY TURN Have a Networking Plan and Work It Before You Need It

By Kevin M. Plante, LPC

A conversation with Mark Stinde of 7-Eleven

59 SOLUTIONS SHOWCASE - Axis Communications - NuTech National - Intelligent Loss Prevention - Securitech - Palmer, Reifler & Associates

By James Lee, LPC, Executive Editor

41 Kirkland’s: Still Going Strong after Nearly 50 Years

68 CERTIFICATION Evolving Attitudes toward Education

By Gene Smith, LPC 70 INDUSTRY NEWS Checkpoint Exits the Video Business

By Robert L. DiLonardo

A profile of the home décor and gift specialty retailer

By Adam Paul, Contributing Writer

71 CALENDAR 71 PEOPLE ON THE MOVE

51

72 ADVERTISER DIRECTORY

Negotiate Like an Interrogator

73 VENDOR SPONSORS 74 PARTING WORDS Never, I Mean Never, Has It Been Better

By Jim Lee, LPC

Using your interviewing skills in negotiation

By Michael Reddington, CFI, Wicklander-Zulawski and Associates

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Publisher’s LETTER

Emerging Technologies

E

verybody knows that we live in a rapidly changing technological world. It seems like the next-generation iPhone or tablet is released before you can replace all the out-of-date accessories. Loss prevention technologies may not change quite that fast, but we are entering a period where new technologies will be making a huge impact on the retail industry.

In the March-April issue our cover story on Sears Holdings’ digital journey talked about their distributing iPads to their LP organization with tools to better understand their business, make more informed decisions, and increase their field organization’s effectiveness.

Facial Recognition

In this issue, our cover story on page 15 examines what one retail executive calls a “game-changing” technology—facial recognition.

When I read this article, I couldn’t help but think about the similarities with the 2002 Steven Spielberg movie Minority Report. It may have been science fiction a decade ago, but it’s in use by one retail organization today.

The facial recognition article was researched and written by Chris Trlica, a new contributor to LP Magazine. You might recognize the last name. Yes, Chris happens to be my older son, and an accomplished writer in his own right.

He is a recent graduate of North Carolina State University with working experience in both botany and nano-technology research labs.

His research and analytical skills make him an appropriate writer to cover some of the emerging technologies that will impact our industry. His current assignment is a deep dive into mobile POS that will likely generate a series of articles.

Mobile POS

Speaking of mobile POS, I sat in two sessions on the subject at the recent Retail Industry Leaders Association asset protection conference. The first one was presented by Mindy Rector, director of innovation at Walmart along with Brand Elverston representing the AP department. They discussed their 200-store test of mobile POS, offering some of their learnings as well as the ongoing challenges.

MAGAZINE 700 Matthews Mint Hill Rd, Ste C Matthews, NC 28105 704-365-5226 office, 704-365-1026 fax

In a separate session, John Aloysius and Viswanath Venkatesh, professors of business and information systems from the University of Arkansas, presented results of a one-year research project focused on assessing the risks associated with mobile POS. Both sessions were packed, which indicates how hot this topic is.

Paradigm Shift

In his Academic Viewpoint column on page 26, Dr. Richard Hollinger also talks about both old and new LP technologies, posing the question, “Is it time for a paradigm shift in LP technology?” Dr. Hollinger’s rhetorical question follows a visit from two Swedish researchers from Lund University. Their research has led to a spin off company that is developing an innovative approach to product protection.

Incidentally, Lund University is one of Scandinavia’s largest research institutions that has generated numerous spin off entrepreneurial technology companies that have impacted our industry, including Axis Communications whose world headquarters remains in Lund, Sweden.

Industry Buzz

The emerging technologies mentioned above, along with subjects like RFID, touchless payment, omni-channel retailing, and others, have created a buzz across the retail industry for the past year or more. It’s exciting, yet also frightening, especially because some LP executives believe the technology adoption is moving faster than the loss prevention strategies, which could be disastrous for retail.

Expect to be hearing even more about the positives and negatives of these emerging technologies at almost every industry event. We’ll do our best to keep you informed inside the pages of this magazine as well as on our website. If you have insights you would like to share on the topic, please contact me at JackT@LPportal.com.

Jack Trlica Editor and Publisher

May - June 2013

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EXECUTIVE EDITOR James Lee, LPC JimL@LPportal.com CONTRIBUTING EDITORS Robert L. DiLonardo Walter E. Palmer, CFI, CPP, CFE Amber Virgillo, LPQ CONTRIBUTORS Read Hayes, Ph.D., CPP Richard C. Hollinger, Ph.D. Adam Paul Gene Smith, LPC Shane G. Sturman, CFI, CPP Chris Trlica David E. Zulawski, CFI, CFE DIGITAL EDITOR John Selevitch JohnS@LPportal.com CREATIVE DIRECTOR Larry Preslar PROOFREADER Amy Trainor DESIGN & PRODUCTION SPARK Publications info@SPARKpublications.com 704-844-6080 A D V E RT I S I N G

LossPrevention and LP Magazine are service marks owned by the publishers and their use is restricted. All editorial content is copyrighted. No article may be reproduced by any means without expressed, written permission from the publisher. Reprints or PDF versions of articles are available by contacting the publisher.

Statements of fact or opinion are the responsibility of the authors and do not necessarily represent the opinion of the publishers. Advertising in the publication does not imply endorsement by the publishers. The editor reserves the right to accept or reject any article or advertisement.

6

EDITOR AND PUBLISHER Jack Trlica JackT@LPportal.com

LPportal.com

ADVERTISING MANAGER Bonnie Dodson 828-479-7472 office, 704-943-5797 fax BonnieD@LPportal.com WEST COAST REPRESENTATIVE Ben Skidmore 972-587-9064 office, 972-692-8138 fax BenS@LPportal.com S U B S CR I P T I O N S E R V I C E S

NEW OR CHANGE OF ADDRESS www.myLPmag.com POSTMASTER Send change of address forms to Loss Prevention Magazine P.O. Box 1088 Lowell, MA 01853 LossPrevention aka LP Magazine (USPS 000-710) is published bimonthly by Loss Prevention Magazine, Inc., 700 Matthews Mint Hill Rd, Ste C, Matthews, NC 28105. Print subscriptions are available free to qualified loss prevention and associated professionals in the U.S. and Canada at www.myLPmag.com. The publisher reserves the right to determine qualification standards.

International print subscriptions are available for $99 per year payable in U.S. funds at www.LPportal.com. For questions about subscriptions, contact circulation@LPportal.com. Periodicals postage paid at Matthews, NC, and additional mailing offices.

© 2013 Loss Prevention Magazine, Inc.

ON THE WEB

EYEONLP

Editorial Board

Check out the new EyeOnLP.com page for the latest videos of what’s on the mind of LP executives and solutions providers, plus assorted videos we think will interest the industry.

Did you miss the RILA asset protection conference in Orlando?

If so, see what you missed on our three daily recaps.

Ken Amos, LPC Divisional Vice President, Loss Prevention, Walgreens

Bob MacLea Senior Vice President, Loss Prevention, TJX

Leo Anguiano, LPC Senior Director, Asset Protection Rite Aid

Chris McDonald Senior Vice President, Loss Prevention, Compass Group NA

Jim Carr, CFI Director, International Loss Prevention, Rent-A-Center

Randy Meadows Senior Vice President, Loss Prevention, Kohl’s

Ken Cornish Vice President, Retail Operations, The Kroger Co.

Dan Provost, LPC Vice President, Global Loss Prevention, Staples

Francis D’Addario Emeritus Faculty Member, Strategic Influence and Innovation, Security Executive Council

Tom Roan Group Vice President, Loss Prevention, Macy’s

Charles Delgado Vice President, Manager of Asset Protection, BJ’s Wholesale Club

Tim Shipman, LPC Director, Corporate Investigations and Crisis Management, Delhaize America

Patti Felz Vice President, Loss Prevention, Polo Ralph Lauren

Mark Stinde Vice President, Asset Protection, 7-Eleven

Barry Grant Senior Vice President, Operations & Loss Prevention, CPI Corp

Paul Stone, LPC Vice President, Loss Prevention and Risk Management, Best Buy

Bill Heine Senior Director, Global Security, Brinker International

Claude Verville discusses people development at Lowe’s as well as his own work toward the LPC certification. Did he get it?

Sonya Hostetler Vice President, Asset Protection & Safety, Walmart Stores U.S. Frank Johns, LPC Chairman, The Loss Prevention Foundation Gary Johnson Vice President, Loss Prevention, Vitamin Shoppe Paul Jones, LPC Senior Director, Global Asset Protection, eBay

ORC is a serious problem that no one takes more serious than Tony Sheppard of CVS. Watch a semi-serious discussion between Sheppard and our own Amber Virgillo.

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Bill Titus Vice President, Loss Prevention, Sears Holdings Claude Verville, LPC Vice President, Loss Prevention, Safety & Hazmat, Lowe's Stanley E. Welch, LPC Vice President, Director of Loss Prevention, jcpenney Keith White Senior Vice President, Loss Prevention and Corporate Administration Gap Inc.

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LP Magazine | May - June 2013

11

interviewing

by David E. Zulawski, CFI, CFE and Shane G. Sturman, CFI, CPP

General Loss Interviewing: Part Two I

© 2013 Wicklander-Zulawski & Associates, Inc.

It is often worthwhile to select the longest tenured member of the staff to begin the interview process even above the manager.

In fact, we have found that if the manager is inept or dishonest, having information from other associates may actually increase the effectiveness of the interviewer during the manager interview.

Questionnaire. Another way to begin ordering the interviews is by administering a questionnaire and evaluating the employees’ narrative responses to the questions. The questionnaire is administered in advance of the interviews and returned to loss prevention for evaluation.

n our last column we discussed some of the issues that need to be addressed before actually engaging in a general loss investigation.

Since many of the causes of losses in a location can be directly attributed to the management of the facility, operations and human resources must be prepared to replace existing management in the event they are the root cause of the shortage.

General loss interviews also typically uncover operational problems and secondary issues that may prove to be as problematic as the original shortage problem. It is not unusual to discover personnel problems or sexual harassment issues, in addition to deficient management at the facility.

There are a number of different ways to organize the order of the interviews at the facility in question.

Random. The most basic order…and least effective…is simply interviewing at random with those employees who are currently working when the interviewer arrives. Sometimes this is the only way to begin if the store was not informed in advance that interviews would be taking place. If the investigators believe that management is unreliable at the facility, then it may be prudent to arrive unannounced so the associates do not have time to prepare for the conversation.

The random nature of the interviews does not allow an interviewer to build on the information developed moving to the next logical interview, because that person may be unavailable.

Randomly interviewing those available also may result in dishonest associates spreading rumors about mistreatment of employees during the interviews to increase resistance of other employees to cooperate in the interviews.

Tenure. The longest tenured employees are likely to be the most loyal and committed of the associates at the facility. Since they are likely to be the most cooperative and have a historic perspective of the changes that may have contributed to the current shortage situation, some investigators prefer to interview them first. An investigator who can identify honest long-term employees at the onset of the investigation can use them to pinpoint when problems first arose at the facility.

These long-tenured employees also are generally looking for a sympathetic ear to correct the problems they face on a daily basis.

While some of their information may be tainted because of their perception of the situation, they can often focus the interviewer on individuals who they suspect of contributing, either directly or indirectly, to the shrinkage problem at the location.

May - June 2013

Wall Mouned Alarm With Direct Power

General loss interviews also typically uncover operational problems and secondary issues that may prove to be as problematic as the original shortage problem. It is not unusual to discover personnel problems or sexual harassment issues, in addition to deficient management at the facility.

Determining the Order of the Interviews

12

Zulawski and Sturman are executives in the investigative and training firm of Wicklander-Zulawski & Associates (www.w-z.com). Zulawski is a senior partner and Sturman is president.

Sturman is also a member of ASIS International’s Retail Loss Prevention Council.

They can be reached at 800-222-7789 or via email at dzulawski@w-z.com and ssturman@w-z.com.

As unlikely as it may seem, some employees will implicate other associates and even themselves while filling out the survey.

Investigators examining these surveys can often find indications of associates who are involved in theft or policy violations based on how they answer the questionnaire. Based on the review of the questionnaires, the investigators can then arrange the employees in the best order to get the most out of the interviews.

Data Sheet. For our investigations into general loss locations, we use an employee data sheet that we have completed prior to our arrival. The employee data sheet categorizes information about each employee and produces a hierarchy of the associates based on the likelihood that they would be involved in counterproductive behavior.

The data sheet captures information from a variety of sources and links these to high-risk categories that are strongly related to theft or counterproductive behavior. The more high-risk categories an individual is in, the greater the likelihood that they would steal continued on page 14 |

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The second part of the investigative inventory is a questionnaire that offers the associate an opportunity to make admissions about himself and other employees relating to illicit behavior or policy violations. Another important scale within the inventory measures how often the associate observes coworkers stealing or violating company policy. In reviewing our files at W-Z, we found that about 30 percent of employees have knowledge or suspicions of theft activities by other associates. Interestingly, about 90 percent of the associates reporting knowledge of another’s dishonesty were under the age of 32.

These examinations, which can be completed online or using a paper-and-pencil format, can generally be completed in 30 to 45 minutes by the employees, and then are computer scored. The investigator receives two types of scores—a percentile score and risk score. The percentile score ranges from 0 to 100 and indicates how an employee scored in relation to other employees who have completed the EAI. The risk score is more useful in that it provides a relative risk of committing counterproductive behavior.

The employees are grouped into three risk levels—low, average, and high risk. To fall into the high-risk category, employees will likely have made admissions of engaging in theft, have tolerant attitudes toward theft, and/or they have observed acts of dishonesty at the organization. The inventory should not be acted on alone, but requires follow-up interviewing to establish the accuracy and scope of the associates’ counterproductive acts.

The investigator now has several ways to rank employees for the interviews using the individual’s attitudes and admissions. It is generally advisable to begin with a trustworthy employee followed by those individuals in the high-risk category who have made admissions of theft or counterproductive behavior. The investigator then works to those individuals who made no admissions, but their integrity attitude has placed them in the high-risk category. Then the employees who are in the average risk are interviewed, followed by those in the low-risk category.

If the EAI is used in conjunction with the data sheet, there may be additional information that would move employees further up or down the interview track. Keep in mind these interviews and investigations are usually more successful when the first person interviewed is trustworthy to give an accurate overview of the group, then followed by those most likely involved in counterproductive behavior.

In our next column we will focus on the actual mechanics and strategies employed in doing general loss interviews.

continued from page 12

or violate policies or procedures. For example, if an individual is disgruntled, both our experience and research into employee theft indicates this is strongly correlated with dishonest behavior.

Clearly, someone who is disgruntled can easily rationalize stealing or violating policies to even the score. The data sheet also correlates well with the integrity assessments, like the Employee Attitude Inventory.

When using the data sheet to organize the interviews at the high-shrink locations, an investigator should begin with either a long-tenured employee or a trusted member of management to get an overview of the location. Next, the investigator should begin his interviews with the employee who has the most high-risk categories associated with him.

Keep in mind these interviews and investigations are usually more successful when the first person interviewed is trustworthy to give an accurate overview of the group, then followed by those most likely involved in counterproductive behavior.

The data sheet is an excellent tool for identifying those individuals with attitudes similar to people who steal. The data sheet can also be used to help focus undercover investigators toward those employees most likely to be involved in counterproductive behavior at the facility.

Employee Attitude Inventory

There are a few useful integrity assessments available on the market to assist in general loss investigations. Most integrity assessments were originally designed for pre-employment applications, not investigations. The one we are most familiar with is the Employee Attitude Inventory (EAI) from Vangent, a General Dynamics Company. Doug Wicklander and Dave Zulawski worked on the predecessor of the EAI, called the Reid Survey III, where they developed the questionnaire portion of this investigative assessment.

There is a strong correlation between the attitude of individuals toward workplace integrity and their propensity to steal. The benefit derived from EAI is it provides validated research connecting the employee attitude with admitted theft and illicit drug usage at work. In effect the investigator is provided with extremely powerful pieces of job-relevant information relating to each associate.

With the EAI, the investigator first receives a measurement of the employees’ attitudes and opinions of theft and how tolerant of theft they are. Not surprisingly, the more tolerant an individual is of theft, the more likely he or she is to be actually stealing from the organization. In a similar fashion, the investigator can also determine the employees’ attitudes toward and tolerance of illicit drug usage, which also significantly correlates with employee theft.

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May - June 2013

W-Z Tip of the Week Video

Visit the EyeOnLP.com page for weekly advice and suggestions on all things interviewing from Michael Reddington, CFI.

|

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Cover Feature

Facial Recognition A Game-Changing Technology for Retailers

By Chris Trlica

Facial Recognitioin that the photo in the alert actually matches the person who just walked in. Then the associate approaches and says, “Mr. Johnson, you’ve previously been given a barring notice from Store-Mart. You’re not allowed to be here. Please leave.” And Johnson walks back out. So, within a minute or so of walking in, a known shoplifter has left the store, empty-handed.

Facial-recognition systems made the leap from sci-fi to reality around a decade ago, but until the past year or two, they never really worked. Governments were the first adopters, targeting fugitives, terrorists, spies, and other high-priority targets. Retailers have had their eyes on the technology for some time, but until very recently, the price point was simply too high to justify.

Now that the detection algorithms have been refined to enable higher identification accuracy, and solutions providers have lowered prices to a range accessible to retailers, facial-recognition technologies are poised to surge into the retail world. And with megapixel IP cameras now standard, many stores are already equipped with the necessary hardware. All that’s left to do is plug them into the system.

EDITOR’S NOTE: This article is based on the experiences of a well-known retailer who is currently implementing a facial-recognition system. Because of the potential value of this technology to the retail industry as well as the critical issues surrounding its deployment, the executive who leads this initiative approached the magazine to offer his insights on the condition of anonymity. Therefore, the names of the individual and the company have been changed.

W

“

e’re seeing shoplifters—known shoplifters—come up to us and ask permission to buy something.”

Is this some kind of LP Twilight Zone, or the delusions of a loss prevention associate who has spent too many hours watching surveillance video? No, this is everyday life in stores at a leading retailer who has recently deployed a facial-recognition system. And it’s just one of the changes that have led the company’s head of loss prevention to call facial recognition a game-changing technology.

“We now know within seconds of a person walking in the store if they’ve previously been caught stealing from us,” says Tom Smith, vice president of loss prevention for Store-Mart. “We now know which hours of the day see the most shoplifter activity. We now know that 26 percent of the people we detain, we see again in the brand within one month, on average 13 days later. We never had a way

How the System Actually Works

First, a database is populated with the enrollees’ facial biometric information. Photos of known shoplifters are analyzed for identifying biometrics, such as length of the nose, distance between the eyes, and that mole beside the

Facial recognition has the potential to change the rules of retail. It could lower shrink, revolutionize in-store marketing, and, ultimately, more efficiently deliver products to consumers, thereby reducing costs for everyone involved—a win-win situation. But as usual, there’s a catch. If deployed without careful, deliberate forethought, the technology could easily be abused, either intentionally or by poor planning, with far-reaching consequences. of knowing things like this before. This is stuff that LP associates will salivate over. It’s going to be a game changer.”

Suppose Johnny Johnson is caught shoplifting at a Store-Mart branch. He’s detained, photographed, and given a barring notice. Johnson’s photo is entered into Store-Mart’s database of known shoplifters, becoming an “enrollee” in the system.

Three weeks later, Johnson walks into Store-Mart again.

Within five seconds, the system has captured his image from the store security cameras, compared it against every photo enrolled in Store-Mart’s database, found a match, and sent an alert to the in-store LP associate’s (LPA) smartphone. The LPA looks at his phone, and Johnson’s name, photo, and detention history with Store-Mart pops up. The LPA verifies

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left nostril. Biometric profiles consisting of anywhere from tens of thousands to millions of these identifying parameters are compiled for each enrollee and linked to their name, photo, and detention history. Only people who are known to have committed criminal activity in the store are enrolled; average customers aren’t ever brought into the equation.

After that, it’s just a matter of connecting the database and the detection algorithms to the store’s cameras. Joe Rosenkrantz, CEO of FaceFirst, a leading biometrics platform provider, describes the process. “A server in the store detects and tracks faces on every frame of video at 30 frames per second. So, we have a very complex scene of people walking in the front door, and we detect every face on every frame of |

LPportal.com

Facial Recognitioin video,” Rosenkrantz explains. “The system isolates the best representation of each person. We analyze each frame for lighting conditions, pitch, and yaw. We might get 50 pictures of a person, and the system, in near real time, analyzes every one to get the best representation.” Each image is scored and the best one has its biometric profile extracted and compared against each profile in the shoplifter database. If no match is found, the image is immediately deleted. If there is a match, an alert message is sent to the designated store associate’s smartphone.

Attached to the alert message is the original photo used to enroll the shoplifter in the system, so the store associate can verify that the person who just walked in the store really is the same person as the one in the database. The retailer can choose to set different kinds of alerts for different enrollees. Smith has created several.

Most enrollees generate approach alerts, in which case the LPA addresses the person by name, reminds them that they signed a barring notice, and asks them to leave. If a person has been definitively observed shoplifting, but was not able to be detained, they may be enrolled using a good photo of them from the CCTV footage, and an observe alert will be issued. In this case they won’t be approached, but will be watched carefully.

A person known to be associated with ORC will have an ORC alert issued, leaving it to the discretion of the LPA as to whether they should make an approach or call the police. In addition, there are alerts advising the LPA to immediately call the police.

Smith says, “We already have one guy who’s a 911 alert. We

had approached this person three times, and the fourth time, he had already started stealing after being in there for 20 seconds.

When we approached him, he physically assaulted our agent and ran out of the store. So, we converted him to a 911 alert.”

The Value of a Photograph

What the technology does is dramatically increase the value of a digital photograph of a shoplifter. Information that has been filed and forgotten can suddenly be put directly into the hands of the person best equipped to act on that information. And it happens entirely automatically, and at precisely the time that information will be most useful.

Retailers who have been diligently photographing each shoplifter they detain may be sitting on a digital gold mine, since enrolling these photos into the system effectively extends the value of the original detention. Suppose a person is detained for a $50 theft and enrolled. Now every time they are recognized and approached, that’s another potential $50 savings—residual value from the original detention.

And the savings extends beyond just the value of the merchandise. There is also substantial savings of store associates’ time. “Just think,” Smith says, “of the LPA who gets an alert, makes the approach on a shoplifter, and tells him, ‘You gotta get out of here.’ That takes about three minutes total. Before, they may have watched that person for 20 minutes until they stole something. And if they had detained that person and processed the paperwork, that’s another 45 minutes. What was going on

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Facial Recognitioin in eventual reduction of man-hours necessary to operate an LP organization,” says Rosenkrantz. “It’s a combination of force multiplication effects and the incredibly valuable statistics.” Of course, the system only detects shoplifters in the database. LPAs will still need to keep a lookout for new enrollees. And some high-risk stores need as many eyes on the floor as they can get.

Rather than threaten LP jobs, the technology will likely aid in the evolving shift in LP responsibilities. “What I’m expecting,” says David Guttadauro, CEO of leading facial-recognition provider Digital Signal Corporation, “is that loss prevention people will be following a trend I’ve seen in the intelligence community, government, and law enforcement, in which the traditional role of the detective is changing into the role of the analyst. Data and technology are really going to be how the LP industry is going to be run moving forward. You look at your risks from the standpoint of data and event patterns, and then you analyze those risks to end up taking more informed, evidence-driven action.”

in your store for those 45 minutes? Now, those efforts can be redeployed onto observing and detaining other individuals.”

LP organizations may even start valuing a photograph more than a prosecution. “The value of a photo is so much,” Smith says, “that I may change the approach for a detention in the store to something less aggressive. We may train agents to approach someone they just saw stealing and say ‘Look, give me back the product, let’s go back to the office, do some paperwork, I’ll take a picture of you, give you a barring notice, and then you’re out of here. I’m not going to call the police.’”

Retailers may also be able to reap benefits from photos of other retailers’ shoplifters. A national shoplifter database similar to the Stores Mutual Association model is already in the works. This would mean that each additional retailer who adopts the technology and starts sharing will incrementally increase the value of the system for all members.

The Importance of Statistics

Despite how useful the system is in enforcing barring notices, the greatest LP benefit of facial recognition may be the quality of data the system makes available. Having solid statistics about which individual thieves enter which stores and the distribution of peak shoplifter activity over the course of a day or a month can be extremely powerful in informing management decisions.

Limitations of the Technology

Determining whether two images of a face match is not a simple yes-or-no question. The system works based on how probable it is that the face on the store camera matches the face in the database. The retailer must set an acceptance

Facial-recognition systems made the leap from sci-fi to reality around a decade ago, but until the past year or two, they never really worked. Governments were the first adopters, targeting fugitives, terrorists, spies, and other high-priority targets. Retailers have had their eyes on the technology for some time, but until very recently the price point was simply too high to justify.

Rosenkrantz says, “Let’s say you have a store and an LP associate is there the entire day. What if the system tells you that 90 percent of the theft is happening during certain hours of the day, and you’re able to adjust the schedule accordingly?” Better data will enable LP departments to optimize the deployment of LPAs to work where and when they’re needed most.

And when an LPA isn’t on duty, they just hand off the smartphone to the store manager. “In the past month, about 20 percent of our approaches have been done by management,” Smith says, “and they love it. They know when a crook walks in their store, and they just walk up to them.” The system puts more power back into the hands of the store manager, giving them a greater degree of personal control over external shrink.

Could this reduce the need for in-store LP professionals? “I think the most major impact to the industry as a whole will be

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probability threshold, which can be a delicate balancing act.

On the one hand, if the threshold for a match is set too low, many ordinary customers could be identified as shoplifters.

This high false-acceptance rate risks alienating customers, wasting the time of the store associates, and generally lowering users’ confidence in the system. “That’s a scary part for me,” says Smith, “the false alert; the boy who cried wolf. But so far it’s low enough—about six out of a hundred alerts—that it hasn’t gotten to that stage. We’ve always been able to use the photo to see that it wasn’t the right person.”

On the other hand, if the threshold for a match is set too high, someone who’s enrolled in the system might not trigger an alert, just because the cameras weren’t able to get a perfect photo of him as he walked in the store. Enrollment photos are usually like driver’s license photos, taken straight-on with |

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Facial Recognitioin even lighting. It’s rare to capture these same conditions on in-store cameras, and any deviation will marginally reduce the probability of a match. “The less that you see of the face, the lower the probability of a match there’ll be,” says Rosenkrantz, “so when our system sees eyeglasses on a person, it actually removes them and makes some assumptions about what’s behind them. We are able to detect people with high match rate who are wearing hoodies, parkas, or scarves, or where the person is looking at their phone or never looking quite at the camera. These things just lower the probability of a match.”

While there are limitations, the system is expected to become ever more accurate as the technology matures.

And in the instances that the system does fail, what’s at stake? “The government uses a lot of facial ID that’s very sophisticated,” says Smith, “but they’re trying to find terrorists.

We’re just trying to ID a shoplifter or two. People have asked me what happens if it misses one. Who cares? I’m just trying to catch shoplifters. I’m not trying to catch an international terrorist. I don’t need the most sophisticated system in the world. I just need one that pays for itself.”

Marketing and the Problem of Privacy

“The initial cost justification that drives the purchase of the system comes from loss prevention,” says Rosenkrantz, “because the numbers are a lot more tangible and you can gain empirical evidence of what your savings are. But retailers are exploring future uses for marketing purposes.”

There is widespread speculation about what will happen after LP departments have given the system a test drive and marketing departments get hold of it. The possible applications are breathtaking in scope. Dynamic advertisements could be targeted very precisely on a customer-by-customer basis. Sales associates with knowledge of customers’ brand, aesthetic, and price preferences could very efficiently guide them to more personally appealing products. Stores could track not only what customers bought, but also what they looked at and didn’t buy.

Biometric-linked credit cards could enable cashier-less purchasing.

“I see it becoming extremely pervasive,” says Rosenkrantz.

“It’s already being used for digital signage for personalized advertisements. It can identify gender and age ranges with about a 90 percent accuracy. I think that the technology will become incredibly pervasive really in the next five to six years.”

Guttadauro agrees. “In five years you’ll see the technology in almost every retail store,” he predicts. “The price point of the technology is going to come down so that it’s affordable based on ROI to almost every retailer.

You’re talking about a game-changing technology that has sales, marketing, and transaction benefits.”

Facial recognition has the potential to change the rules of retail. It could lower shrink, revolutionize in-store marketing, and, ultimately, more efficiently deliver products to consumers, thereby reducing costs for everyone involved—a win-win situation. But as usual, there’s a catch. If deployed without careful, deliberate forethought,

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Facial Recognitioin about specifically who that person is and then track that person every time they walk in the store? In that situation it’s a huge impact on privacy. And stores may be tempted to go even further and sell the information, and that’s a huge problem as well. In the online world and the offline world, it’s very easy for data to be collected and then combined with other data so that marketers have a very distinct picture of a person that people would never know about.”

the technology could easily be abused, either intentionally or by poor planning, with far-reaching consequences.

The way they’re presently deployed for LP purposes, facial-recognition systems are designed to be very conservative. There is little privacy threat and limited potential for abuse. The system immediately discards images of anybody who isn’t a match to a known shoplifter.

Compare this to ubiquitous archiving of CCTV footage of everyone who enters a store. Surely facial-recognition systems are less intrusive than standard video archiving?

“I would actually agree that, if the system is truly set up like that, it’s definitely less intrusive than holding onto security camera footage,” says Jennifer Lynch, a staff attorney with the Electronic Frontier Foundation, an international digital rights organization. “A system that is designed to look only for people who have been convicted of shoplifting in the past is not going to be a threat to privacy for the vast majority of shoppers.”

The conservative design of Smith’s system is the result of long, hard thought about the privacy and process issues he needs to address. But will every retailer be so careful? For loss prevention the only people enrolled are shoplifters. LP doesn’t need to identify and track average customers. But marketing is frothing at the mouth at the prospect. And when average customers are enrolled is when potential problems set in.

“The real privacy issue for marketing is how stores are holding on to the data,” emphasizes Lynch. “Are they using a system that just detects a person’s gender or age range, then forgets their image? Or do they collect identifying information

The Risks of Ignoring Privacy

Imagine a retailer that identifies and tracks every customer that enters the store. Imagine they scour Internet image databases, housing records, Facebook and LinkedIn profiles, until they know not just your name, age, address, birth date, and brand preferences, but also income bracket, credit score, social circle, work schedule, and the number and approximate age of your children. Imagine the retailer sells this information—to other retailers, lenders, government agencies, or whoever has the money. Imagine there is a database out there with an incredibly detailed profile of what you like, what you do, and who you are. And you can’t change it, delete it, dispute it, or even see it. You might not even know it’s there.

These are the sorts of possibilities worrying both privacy advocates as well as forward-thinking retail executives; the possibilities that are ripe for abuse, which would likely result in a consumer backlash. For retailers the potential cost of consumers becoming alienated and eventually rejecting continued on page 22

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Facial Recognitioin that could cripple the technology and deny the industry an incredibly powerful, potentially game-changing tool.

Guttadauro believes his company’s technology is so powerful, he won’t even sell it to retailers until the privacy and process goals have been adequately addressed. “I don’t believe they’ve done enough work to protect the people on the other side of the camera,” he says. “I wouldn’t want to risk the market. We need to build a consortium between vendors, retailers, and consumer advocates to really build a foundation of standards.”

To what degree consumers ultimately accept or reject the technology will be in large part dependent on the PR response to the first widespread public acknowledgement of the system and its capabilities. Having standards and customer protections already in place will be invaluable in convincing an already-skeptical public that the technology will help them more than threaten them.

Standards will need to address issues like enrollment and unenrollment procedures, data storage and protection, data sharing, transparency, and data ownership, among other things. Different standards may need to be developed for different purposes. For example, Smith says, “We let shoplifters know that we intend on approaching them and that we reserve the right to use biometric ID to identify them for the purposes of enforcing a barring notice.” But when it comes to the general public, “We need to let customers know that they own their image and they’re in control

continued from page 20

the technology is enormous, even beyond the loss of a tool as valuable as facial recognition. The PR nightmare and consumer pushback resulting from the wrong sort of publicity could do serious damage to a brand.

The storage and protection of biometric databases presents a further risk. Even very tightly secured credit card databases have been compromised multiple times in recent years, allowing hackers access to hundreds of millions of customers’ credit cards and other sensitive information, and costing companies billions. For consumers having credit card information stolen is usually more inconvenience than danger; they simply replace their cards. But it’s much more difficult to get a new face.

Who is liable if a biometric profile is stolen? What new crimes are possible if criminals have access not only to the usual information stolen during identity theft, but also to information about a person’s physical features and a complex profile of preferences and behavior patterns?

If nothing had yet sparked consumer outrage at facial recognition, identity theft of biometrics is sure to.

Even if the vast majority of retailers use the system conscientiously, all it would take is one example of major

Facial-recognition technologies, and the torrent of new data they bring, are poised to dramatically alter the LP landscape, changing the day-to-day life of LP professionals, informing top-level decision making, and shifting the way the industry as a whole operates. Soon after, the technology will set the stage for a radical paradigm shift in retail marketing and the retail customer experience. of their image,” says Guttadauro. “If they want to be detected, they should be able to opt in for detection. And since it’s your right to opt in, we should also guarantee that you can opt out.”

A standards consortium could protect the industry moving forward, but only if it actually succeeds in protecting the consumer as well.

abuse to jeopardize the use of the technology by all. The legal space surrounding the technology is very blurry. If major abuse came to light or a PR incident was handled poorly, there is a risk that legislation would be crafted too hastily and thoughtlessly, which could end up crippling the technology.

Leading the Charge

Future Directions

Loss prevention professionals are the first adopters, leading the adaptation of this incredibly disruptive technology to the retail world. This leaves the LP industry with the opportunity to spearhead the adoption of privacy standards, process standards, and consumer protections, setting the tone for the impending adoption of the technology by other segments of the retail industry. By very careful, deliberate self-regulation, retailers may be able to avoid consumer pushback and knee-jerk over-regulation

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As the technology evolves and becomes more widely adopted, there will be many challenges and many benefits to be gained if challenges are properly addressed. What else is on the horizon?

Industry experts are already predicting an ORC response.

There may soon be blogs sharing tips about how to confront facial-recognition systems and listing which brands and which stores within each brand are known to use them. “When most continued on page 24 |

LPportal.com

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Facial Recognitioin him, we’re going to register him into the database, we’re going to have his parents come down and sign a form saying ‘Johnny will never shoplift again and I agree to let you use his image.’

The next time he comes back into the store you say ‘Welcome back to Store-Mart, Johnny. Please don’t shoplift, or we’re going to call your parents.’ It’ll have the same effect on shoplifting, but the kid doesn’t end up with a criminal record, and the court costs are significantly less both for the retailer and the municipality.”

Facial-recognition technologies, and the torrent of new data they bring, are poised to dramatically alter the LP landscape, changing the day-to-day life of LP professionals, informing top-level decision making, and shifting the way the industry as a whole operates. Soon after, the technology will set the stage for a radical paradigm shift in retail marketing and the retail customer experience. Like most disruptive technologies, facial recognition has the potential to bring considerable benefits as well as considerable abuse. It’s in the hands of loss prevention leaders today to choose the course for the future and to blaze the path that takes us there.

continued from page 22

retailers in a certain geographic area adopt the technology,” says Smith, “those who haven’t could end up taking a disproportionate amount of ORC theft until they’re on a level playing field. It’s a mousetrap game. I think it puts us one mousetrap ahead of the people who are really burning us in ORC activity. I do think they’ll catch up, figure out how to beat it, or go where it’s not.

But I think it eliminates, or close to eliminates, personal use theft in a store. And that’s huge. Because all that’s left is the new batch that comes in, and they don’t show up at the same rate.”

Meanwhile, the technology itself is only going to become more accurate and comprehensive. Current retail solutions leverage existing IP cameras, which generate a normal two-dimensional image. The most sophisticated facial-recognition solutions, used by governments and intelligence agencies and already nearing perfect accuracy, use special cameras to generate a three-dimensional model of the face. There is also research toward a mixed biometric approach, using gait recognition, earlobe recognition, skin-texture recognition, and other biometrics that could make it possible to identify a person without even needing to see the face.

The technology could also have positive effects that spread from the industry into greater society. “Take juvenile delinquency,” says Guttadauro. “For a 15-year-old shoplifter, a conviction scars them. They get no financial aid, fewer job prospects. Retailers are literally creating a downward cycle of shoplifting by the way that we approach it as a whole. Using facial recognition, if we catch a 15-year-old shoplifting, we’re not going to prosecute

CHRIS TRLICA is a business and technology analyst and researcher based in North Carolina.

He is a new contributing writer to LP Magazine focusing on emerging technologies. He can be reached at chris.trlica@gmail.com.

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25-04-2013 17:16:34

ACADEMIC VIEWPOINT

by Richard C. Hollinger, Ph.D. Dr. Hollinger is chair of the Department of Sociology and Criminology & Law at the University of Florida, Gainesville. He is also director of the Security Research Project, which annually conducts the National Retail Security Survey (soccrim.clas.ufl.edu/criminology/srp/srp.html).

Dr. Hollinger can be reached at rhollin@ufl.edu or 352-294-7175. © 2013 Richard C. Hollinger

Is It Time for a Paradigm Shift in LP Technology?

T

Countermeasures to detect booster bags with metal detectors are promising, but thus far have not been widely employed.

RFID is slowly replacing bar codes for logistics control, inventory, replenishment, and theft detection. However, many RFID tags are as vulnerable for removal or disabling as earlier EAS tags. We also are seeing more use of both customer self-checkout and mobile cash registers wirelessly linked to the sales transaction system. Mobile tablets and smart phones are expected to be important platforms for future sales transactions with the customer.

The increased use of digital video surveillance grew rapidly during the last decade. Despite advancement in real-time video analyses, most of this higher resolution video is still only useful for investigation afterward to determine what happened and not very helpful for immediate apprehension. However, in addition to theft investigations, these high-resolution digital video systems do add value for merchandisers by registering when, how, and where customers…and thieves…move through the store.

As of today three older EAS technologies are operating almost completely independently of each other among the major retail chains. Unfortunately, none are delivering the ROI we should expect in loss prevention detection or apprehension given the huge expenditure of money. Perhaps it is time for a “paradigm shift” in loss prevention technology.

The philosopher Thomas Kuhn introduced the concept of paradigm shift in 1962 to signify when an entirely new way of looking at or thinking about solving a problem is introduced. In academia we have seen many paradigm shifts over the years in research, usually leading to a major scientific advance or a new way of problem solving.

he first EAS system with tags placed on products with alarm sensor portals at store exits was designed

by Arthur Minasy, the founder of “Knogo” in the mid-1960s. Despite advancement in loss prevention technologies and strategies, thefts by both customers and personnel employed by the store still remain at an unacceptably high level. In response, some store managers are still inclined to lock up the most valuable and theft-prone products, which considerably reduces sales.

Over the years the thieves have learned how to defeat EAS systems by ripping off the tag, disabling it, or just walking out the door with the goods still alarmed, since the chance of being apprehended and prosecuted is very small. Most shoplifters have left the store long before the store personnel can arrive on the scene.

As of today three older EAS technologies are operating almost completely independently of each other among the major retail chains. Unfortunately, none are delivering the ROI we should expect in loss prevention detection or apprehension given the huge expenditure of money.

Perhaps it is time for a “paradigm shift” in loss prevention technology.

New Swedish Technology

Last month, Read Hayes and I received a visit from a Lund University (Sweden) research team led by Professor Sten Wandel and Chief Engineer Mats Johnsson. Since the 1990s these researchers have been investigating how to improve security and risk management in supply chains from raw material to the checkout counter. It resulted in four Ph.D. dissertations, all of which concluded that much less than optimal technology is invested in theft countermeasures.

Moreover, they have concluded that theft-prevention seals for containers and tags for packages are far too easy to defeat. This research led to a spin-off company called TamperSeal AB that developed the TamperShield system.

With this system, the object being protected, together

Loss prevention industry solutions providers have responded with making it harder to separate the EAS tag from the goods by adding devices such as spider wraps, keepers, and benefit-denial tags. However, professional criminals quickly also learned how to remove them or disable any new theft-deterrent devices. Thieves working for organized retail theft teams more often place the goods in a foil-clad booster bag that interferes with the EAS signal.

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with a device containing sensors, processor, and a radio transmitter, is vacuum sealed with a plastic film shield covering the entire package. The system senses and interprets exactly where the package is located in the store and what is happening with the object.

Moreover, as Read and I saw for ourselves when it was demonstrated for us here at the University of Florida, this technology reports tampering via radio to a server that, in turn, alerts store sales and LP personnel for further action.

Their product can interpret when a product is either placed in a booster bag or when the seal is broken, which sends a radio alarm to the server. The server automatically activates the video system to record the incident and also activates a sound and light alarm to deter the thief. Real-time videos of the thief in action, together with the specific location of the event and product name, are simultaneously sent to store personnel closest to the theft scene.

This approach gives store personnel more time as well as better information for apprehending the criminal compared to current LP systems. Hopefully, the theft attempt will be interrupted and the product will stay in the store. Since videos and other information are recorded, it can be used for evidence in court and for analytic and educational purposes. Hence, the retailer’s LP division can prepare a package of evidence and investigative results to give to the police and criminal prosecutor. Moreover, the system learns by mistakes and becomes more intelligent for each event.

According to Wandel and Johnsson, further advances of the product system are aiming at taking advantage of the information provided by the system. These include development of applications, such as finding the location of a specific product, automatically taking inventory before order replenishment and to replace misplaced products, and analyzing how the customer handles a specific product before replacing it or taking it to the cashier.

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While I am not an engineer and this column is not designed to endorse any specific products, my personal review of this paradigm shift suggests that products like this hold real promise to be a “game changer.” It would appear that TamperShield radically improves loss prevention by getting the most out of existing EAS and by making the video system much more proactive in real time by means of its intelligent and integrated radio infrastructure.

It simultaneously has the potential to deliver considerable value for both merchandisers and logisticians. Since its sensor device immediately sends an alarm when the package is opened, the alarm device is separated from the product, or the package is placed in a foil-clad bag, pocket, or coat, it is expected to deter the criminals enough for retailers to allow displaying more theft-prone merchandise for self-service, and thereby considerably increase sales.

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Educating an Industry, One Leader at a Time

INTERVIEW

Asset Protection in a Convenience-Store Environment A Conversation with Mark Stinde of 7-Eleven

By James Lee, LPC, Executive Editor

INTERVIEW I interviewed and took a role as a store detective in a new store in Puyallup, Washington, and my LP career was born.

EDITOR’S NOTE: Mark Stinde is vice president of asset protection for 7-Eleven, Inc. He has over 24 years of experience in loss prevention, safety, and store operations management roles for various retailers, including Circuit City, Sears Holdings, The Home Depot, Toys“R”Us, and others. Stinde serves on the Asset Protection Leadership Council for the Retail Industry Leaders Association and the editorial board of LP Magazine, and has been active in many other LP trade organizations.

EDITOR: And that career has taken you to work for what other companies?

STINDE: I spent seven years with Mervyns, and then took an

opportunity with a company called Lamonts Apparel in the Northwest as a loss prevention investigator. I was promoted within the year to shrinkage control manager, and then about a year later to regional LP manager. When they filed for bankruptcy in 1995, I went to Toys“R”Us for three years, then to Home Depot where I spent a total of seven years.

A couple of opportunities with Home Depot that gave me experience outside of the LP arena, were the roles I held as senior director of safety and as district manager of operations. The role in safety was very fulfilling, and we made huge progress as an organization not only in the area of safety, but also in the area of environmental compliance.

Two years after taking the safety role, the company decided to move safety back into loss prevention. My division president offered me a district manager role in operations in St. Louis.

EDITOR: I’m sure most of our readers have visited a 7-Eleven store at some point, if not on a daily basis. How widespread is 7-Eleven today?

STINDE: The brand of

7-Eleven has grown to over 50,000 stores worldwide in sixteen countries. In the United States and Canada, which is specifically my area of responsibility, we have more than 8,000 stores. Just last year we grew by close to 1,000 stores. Obviously, we have a heavy focus on convenience. However, our goal is not only to be the best convenience-store retailer in the world, but also the best retail company in the world. We are known as a beacon in the night for our customers, or guests as we call them, who are looking for a place to get a cup of coffee, a cold drink, or something good to eat at any time of the day or night.

Most people think of 7-Eleven as a small-box retail store and think that the issues we face are scaled down the same way.

But we do a lot of things in our stores and face some complex issues. We sell food items, which involves food-safety issues. We sell tobacco products, which come with regulatory concerns. We sell gasoline that comes with environmental challenges. On top of that, we’re a 24-hour operation that brings in guests at all hours of the day and night, which presents a number of issues.

EDITOR: Who are your typical customers?

STINDE: For some guests, we’re their neighborhood grocery

store. For others, we’re just that convenient place where they get a meal, a cold drink, gasoline, or a Slurpee® beverage.

EDITOR: Ah, the Slurpee. What’s the story behind that?

STINDE: Years ago, the owner of one of our stores had

the idea that if he took the syrup that is used to make fountain drinks and chilled it, that it would freeze and make a great product. He tried it actually using a car air-conditioning unit the first time, and it worked. That product is what we know as the Slurpee today.

I spent two years there before the LP bug bit me again.

At that point I went to Sears as division vice president of full-line stores. I was at Sears for a short time when Circuit City recruited me for the top LP role. I started as the director, but was promoted to vice president eight months later. I was with Circuit City until they closed in the spring of 2009. The bankruptcy wasn’t fun to go through, but it was a huge learning opportunity for me. When they went out of business, I worked for Protiviti as the associate director of the loss prevention practice for a year and a half before I got the phone call from 7-Eleven.

EDITOR: Before we go in-depth into your current role, tell our readers how you got into loss prevention originally?

STINDE: I came home to Federal Way, Washington, from

school one summer and needed a part-time job. I responded to an ad for hourly associates at a Mervyns store and took a job in their shoe department as a salesman. I stayed there for a couple of years. While I was there the LP staff often asked me to assist in apprehensions. Eventually, the LP district manager, Mark Thomas, asked me if I had any interest in loss prevention. He was very instrumental in my career. So,

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INTERVIEW EDITOR: What enticed you to go to a convenience-store-type operation?

STINDE: When I first learned of the opportunity, I asked

questions like: Is it a growth company? Do they have a good strategy? What’s the leadership like? Would this be a place that I would want to spend some years of my career?

Can I make an impact? After my research, I knew that it was a great company. I also thought that it was a great opportunity to bring some ideas and best practices from the LP industry into their asset protection program to make it even better. 7-Eleven had always had a senior director of loss prevention, but never a vice president. I came in as senior director and within a year was promoted to vice president.

EDITOR: How is loss prevention at a convenience store different from a traditional retail store?

STINDE: Most people think of 7-Eleven as a small-box

retail store and think that the issues we face are scaled down the same way. But we do a lot of things in our stores and face some complex issues. We sell food items, which involves food-safety issues. We sell tobacco products, which come with regulatory concerns. We sell gasoline that comes with environmental challenges. On top of that, we’re a 24-hour operation that brings in guests at all hours of the day and night, which presents a number of issues.

So, as I came into the company, it didn’t take me long to understand that it’s a complex business model even though

it’s a small store. And I’ve always believed that even though my function within the company—asset protection—is a support function, the best way for me to do my job is to have a true understanding of what it takes to operate the business. In fact, in my first ninety days with the company, I spent sixty days in a store learning the business, all the way from how you order donuts to how you clean the grill to food temperature expectations. The operational knowledge that I gained early on helped equip me to better manage asset protection and better support the business.

EDITOR: Many people might imagine robberies to be a significant problem. Is that true?

STINDE: If you go back to the late 1970s, our robbery rates were

challenging. The company engaged not only some consultants to help them with the problem, but they actually went into the prisons of America and interviewed felons convicted for robbery. They asked them things like “What compelled you” and “Why did you choose one place to rob over another?”

Some of the insights that they discovered include how well a store is lit, both inside and outside. How clearly you can see in and out of the store is important. Making sure our associates are aware of and address every guest that comes in. We also determined that it was important to keep cash levels low, because even if a robbery occurs, if that person only gets say $35, they’re going to figure out over time to avoid 7-Eleven because we don’t have much cash on hand.

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INTERVIEW goals, shared responsibility, and shared accountability.

To get there you have to both understand what you’re trying to accomplish, to make sure everyone buys in and is committed to their role in success, and to make sure we are holding each other accountable for the outcomes.

EDITOR: How did the 7-Eleven LP team respond when you came in?

STINDE: When I got here, it was clear to me that we had

really smart people in the organization who wanted to do great work. One of the things that I pride myself in is trying to cast a good vision. Our goal is very clear if you ask any of them. It’s to make 7-Eleven’s asset protection team not just best-in-class in convenience stores, but in all of retail.

Day one was an assimilation day before we spent two days talking strategy. In that first discussion, the team sent me out of the room to develop questions. One of the questions was, “Do you have a trailer full of people parked around the corner that you’re going to replace us with?” Here’s what I told them. The expectations of an asset protection executive in this organization will consist of three things. First, you must be a great leader, be good to people, and work well with others. Second, you must have a strong business acumen; not just asset protection acumen. You have to understand why it’s important for the operator to be selling fresh food, understand margin, and understand what a P&L looks like and how to contribute to the P&L. And third, and least important of the

EDITOR: What are some of the financial and operational accountabilities that asset protection has accepted responsibility for?

STINDE: All our investments

require certain return.

And that return is distilled down to a performance scorecard. The team is held accountable month to month on what it’s going to take to get that financial return. With our P&L and scorecard reviews, there’s a very clear understanding that if they don’t meet their financial return, that this will impact their performance.

EDITOR: What’s changed over the past three years with the asset protection program at 7-Eleven?

STINDE: When I came into the organization, during

The expectations of an asset protection executive in this organization will consist of three things. First, you must be a great leader, be good to people, and work well with others.

Second, you must have a strong business acumen; not just asset protection acumen.

You have to understand why it’s important for the operator to be selling fresh food, understand margin, and understand what a P&L looks like and how to contribute to the P&L. And third, and least important of the three, is that you are a highly functioning asset protection practitioner.

that first meeting with the team, we took an article out of LP Magazine that talked about the nine consistent attributes of best-in-class loss prevention programs [see “Lessons from Low-Shrink Retailers,” September-October 2007 page 56]. During those two days, we went through that list of nine things, working together asking, “What are the actions we need to take to get from where we are today to best-in-class?” We really had some honest conversations about where we were as an organization, and that was the genesis of our new strategy for the department. I challenged the team to focus, not on what others could do for us to make us best-in-class, but what we could do independently as a department to get there.

EDITOR: What were some of those key LP initiatives that you implemented?

STINDE: I believe in trying to make it as simple as you can,

so as a team, we tried to take that nine-element approach and distill it down to determine what it would look like in 7-Eleven. We came up with what we call our “four-pillar strategy,” which starts with people and ends with people.

We start with the foundation of our strategy, which is the asset protection team. This team consists of all of our key team members, which begins with the associate who interfaces with our guests day to day. The team includes the franchisees and store operators, the field operations team, the store support center; really each and every member of the 7-Eleven team. Each team member most know their role in keeping our stores safe and minimizing loss in our stores.

three, is that you are a highly functioning asset protection practitioner. If you have all those things, I have no need to replace you because you have all the skills to do a great job.

I also stressed the need to not only develop a partnership within the AP organization, but within the corporate organization. Early on in my career, I learned to distinguish between a relationship and a partnership.

You can have a relationship with someone, and yet you’re not always mutually committed to the resolution of something. For me a partnership consists of shared

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INTERVIEW The first pillar is what we call revenue-and-profit assurance, which is focused on making sure that what gets reported in the stores, whether it be a sales number, a profit number, a mark down, or a write off, is all reported correctly.

The second pillar is what we call our inventory variation control. Most companies would call that shrink control. But for us, any variance says there’s something wrong in the business that needs to be identified and corrected. This means the team is focused as much on overage as they are on shortage in the stores.

The third pillar of the strategy—incidents and investigations—is not only investigating, but really doing the work on the back side of that to understand what occurred and what mitigation strategies we need to put in place to either engineer out the risk for the future or put in operational controls to control the risk.

And then the last pillar is safety and asset protection awareness. That’s making sure that we engage our associates on what it is they need to do that will keep them safe and prevent loss. We distribute monthly posters to our stores that tell the story from a safety perspective, from a fraud perspective, and from an operational loss perspective. We look at the different components of the business so the associates in the stores, every day, can learn to better control those areas of the business.

EDITOR: What was the greatest adjustment you had to make to manage risk at a convenience store?

STINDE: We have 1,000 customers a day come into an average store, 24 hours a day, at five dollars a transaction, so you have to look at that kind of business differently than a lower velocity business. Plus, being open overnight adds a myriad of other issues. So I had to adjust, personally, to make sure we built a strategy to fit our specific situation. That’s actually one of the nine components of that LP Magazine article. One thing I’ve emphasized whenever I talk about the 7-Eleven AP strategy is that it isn’t my strategy; it’s our strategy. We built it together. For example, at first, I had shortage control as the second pillar. The team said, “Oh, no. At 7-Eleven it’s got to be inventory variation control.”

It’s a different business. I learned I couldn’t just come in and plug-and-play my philosophy of what loss prevention was, because in convenience-store retailing there are unique issues.

EDITOR: How do you measure your success?

STINDE: I think back to my early career, when it was all about

stats—how many shoplifters did you catch; how many internal theft cases did you resolve? While all of those do have some contribution to the financial success of the company, if that’s the only place you find value in your program, you’re missing the mark. We can’t just be a cost center in the organization; we really should be an income center. Also, you have to consider if asset protection in any way negatively impacts the customer experience in the store. Are there unintended circumstances where we might win financially in the program itself, but lose

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INTERVIEW somewhere else? So, you have to look at it with an all-inclusive lens, trying to better understand the value of the program as a whole.

computer. APIS enabled us to now track incidents and cases all the way from cradle to grave.

Many of our stores were still using out-of-date VHS video technology…if you can say “VHS” and “technology” in the same sentence. Bringing all of our stores into a digital video format was a huge investment. But we worked with senior leadership and last year spent $40 million on new digital video technology for stores. This did not include the nearly $10 million we spent in new stores and acquisitions. We’re about to embark on another phase of DVR upgrades later this year.

We made sure that all these new technologies were compatible with each other and were able to integrate together.

The real power of this technology is to have these systems all working together.

EDITOR: What technologies have you adopted in your time at 7-Eleven?

STINDE: One of the nine elements in that best-in-class article

was using data to drive decisions. The asset protection group lacked the data needed to support the business. For example, we didn’t do any exception reporting. So, we purchased a new state-of-the-art exception-based reporting system called SecureTM from Sysrepublic. This system integrates our ClickIt DVR technology that we engaged Tyco Integrated Solutions to deploy in 2012. The Secure system also is integrated into our APIS case management system. Each technology improvement provides great value to our program, but the effective integration of all of these tools is really what makes the system powerful and adds value.

EDITOR: How did you deploy your digital video?

STINDE: First of all, I have to recognize Tyco Integrated Security,

who did a flawless job on the integration of 4,000 systems in nine months in our stores, which was a Herculean effort. We have two IP cameras in every store. That may sound like a small number, but we’re a small format store. One of them is a 360-degree camera, and one is a 180-degree analytics camera at the front door. We have the ability to measure traffic, dwell time, and other analytics from the systems. Not only do we have remote access to the systems, but we have integrated this video into our Secure exception-reporting system.

EDITOR: What have you done with it?

STINDE: The nice thing about the Secure system is the ability

to integrate to any type of data that we need to bring in. We bring in Oracle feeds, mainframe feeds, and flat-file feeds.

It’s flexible enough to take any data source, map it to our database, and run exceptions on the data.

We had opportunities to automate our case-management process, which had previously been merely a manila file folder in the file cabinet or document stored on the desktop of the

continued on page 36

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INTERVIEW STINDE: The first person who really lit the fire under me as a young loss prevention practitioner was Mark Thomas, my regional asset protection manager at Mervyns. He encouraged me that every day I came into the store to ask the store manager what the sales were for the day before. To talk to the assistant managers to find out the challenges they were dealing with and how you could support them. He taught me from the start how important it was to be that cross-functional partner.

I also learned a lot from Ed Wolfe when I was at Home Depot.

He’s a guy who always stood for quality in his organization, and he promoted me to my first divisional director role.

But truthfully, I learned more about what it takes to run an effective loss prevention program in the eighteen months I worked for Bill Titus at Sears than I learned anywhere else.

continued from page 34

EDITOR: Is anyone inside the company outside of asset protection making use of that information?

STINDE: Absolutely. The customer insights team, the innovations

team, the new store design team have all tapped into it. There are many examples of how we are putting this valuable data to use to better understand our stores and our guests.

EDITOR: What do you see as the vision in the next 12 to 18 months?

STINDE: We always have

to stay vigilant to some of our key robbery-prevention procedures because of the fact that we operate 24/7 in all different parts of the country.

We will continue to focus on safety. Can we do a better job when we design a store?

Operationally, can we put better standards in the store?

We’re also still in the very early stages of what we can do with data. We’re doing a great job around the point of sale, but what additional things can we do around some of the other components in the business?

Then, how do we bring in some of the best practices from the larger LP industry? How do we leverage our RILA, NRF, and FMI partnerships to learn from what other folks are doing in our space? And even if they’re not doing it in the convenience-store space, how can we take what others are doing outside convenience and adjust it to meet a need within our business?

EDITOR: Finally, I know that family is an important part of your life.

STINDE: Yes, my family and my faith have been very

important to me throughout my life. I am more committed to each of these in recent years, and my wife and I are very involved in a local Christian church. There are a lot of people

Early on in my career, I learned to distinguish between a relationship and a partnership.

You can have a relationship with someone, and yet you’re not always mutually committed to the resolution of something. For me a partnership consists of shared goals, shared responsibility, and shared accountability. To get there you have to both understand what you’re trying to accomplish, to make sure everyone buys in and is committed to their role in success, and to make sure we are holding each other accountable for the outcomes.

EDITOR: Are there any other programs that are important to your asset protection organization?

STINDE: We see law enforcement as partners in the stores.

For example, we try to be that beacon in the night for the law enforcement officer who wants to come in and get a cup of coffee and do a report, which gives our stores a good visual deterrent at the same time. We are very proud of our Operation Chill program. This program gives us the ability to engage two very important groups—law enforcement and youth. 7-Eleven donates one million Operation Chill Slurpee coupons annually to law enforcement agencies in the communities we serve. The law enforcement officer is to “catch” a young person in the act of doing something good and then reward them with an Operation Chill coupon that can be redeemed for a Slurpee. This is a huge hit with our guests and with our law enforcement partners.

who have helped me along the way. The principles I learned as a young child growing up in the church are things that I try to apply every day in both my personal and professional life. My wife Niki and I will be married three years next October. I have two beautiful children, Katelyn, who is 24 and lives in the Seattle area, and a two-year-old, Connor, who is my wingman. Katelyn graduated from the University of Puget Sound and followed her dad into retail at Target. I am very blessed in so many ways.

EDITOR: It’s obvious from this discussion that you’ve developed into a strong LP executive. What one or two people have been most influential in your professional development?

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The future is always brightest for those who do their homework.

At Palmer, Reifler & Associates, one of our ongoing assignments has been filing lawsuits against theft offenders to support our civil demand efforts on behalf of our clients.

Litigating theft cases is an important investment as it sets a clear public precedent. How public? Theft offenders are learning all about civil recovery with some basic online homework of their own. A program that combines civil demand and litigation provides a solid education to theft offenders about retailers’ true legal rights and their intentions to recoup losses caused by theft.

It may not be physics, but it is a sound formula for Civil Recovery law, for the long term.

Evidence-Based

by Read Hayes, Ph.D., CPP

How Protective Countermeasures Actually Work

Dr. Hayes is director of the Loss Prevention Research Council and coordinator of the Loss Prevention Research Team at the University of Florida. He can be reached at 321-303-6193 or via email at rhayes@lpresearch.org. © 2013 Loss Prevention Research Council

J

udgment is everything for a loss prevention decision-maker. And good choices are a lot easier with good information—hence evidence-based loss prevention (EBLP). As part of our march toward EBLP, it’s important to continue rolling out a common language and understanding in the same way as other professions.

In earlier columns I’ve discussed how critical it is to accurately diagnose the causes and dynamics of a problem to properly treat it using techniques like the SARA problem-solving process. In this column we mention how it is equally important to be able to align and describe how a selected protective countermeasure or treatment actually works to affect a problem. We want to be able to describe an LP effort’s mode and mechanisms of action.

Modes and Mechanisms of Action

As part of our research team’s efforts to support multiple retailers, we have attempted to carefully describe how solutions we work with actually affect theft attempts. By knowing how solutions work, we can better determine why or why not and how well they work so we can make improvements.

Our current research ranges from using large datasets to extensive in-store offender interviews to randomized controlled trials (RCTs). In the case of offender interviews, we are increasingly running subjects through stores that we have specially set up in order to determine what countermeasures offenders tend to notice (see), recognize (get), and respect (fear).

We can then compare which interventions work best, and how we can boost intervention performance by “tweaking” our deployment and execution.

A huge part of this process is thinking about how these protective treatments actually work. We generally categorize treatment actions into overall modes of action, and then describe the specific mechanisms of action of these modes.

Modes of action are therefore broader and usually mean the countermeasure makes stealing harder for a thief, appear riskier, or makes theft less rewarding. Some treatments can have more than one mode and even multiple mechanisms of action.

Below are examples of some current LP treatments we are to which we are exposing offenders in our CVS StoreLab location, as well as evaluating in larger field RCTs with multiple retailers.

In this list I have described how we believe the treatments work in the real world to discourage or disrupt offenders. ePVM Treatment. Enhanced public view monitors have visual and aural enhancements added to increase the likelihood offenders will detect, recognize, and be seriously concerned about the deterrent measure.

The mode of action in this case is centered on increasing the perceived risk of detection, rapid response, and detainment with serious formal and informal sanctions. The specific risk mechanism follows this scenario—if the ePVM is seen and recognized, offenders might believe they’re being currently monitored, and their face will be recognized and directly tied to a specific crime event (what, where, when).

Protective Fixture Treatment. The first mode of action here is focused on increasing the effort required to access or remove an asset. Protective fixtures increase needed tasks, require special knowledge or tools that increase the required time, force or strength, and danger to steal merchandise.

Today, led by a growing number of LP executives, the Loss Prevention Foundation, LP Magazine, FMI, NRF, RILA, and others are coordinating in different ways with the LPRC to use research to eventually provide LP managers the critical process and impact data they deserve.

Consider this. In medicine a nurse or physician’s assistant carries out a doctor’s orders. But it is the doctor who has had extensive training in understanding in great detail how a problem occurs and the mechanisms of action of prescribed solutions. That level of training leads to much more precise and cost-effective solutions and helps avoid dangerous and costly side effects.

As we collectively raise the bar in this industry from relatively imprecise decisions to highly informed ones, we are in part talking about decision-makers moving up to the physician level. LP executives will increasingly have a much greater and deeper understanding of problem dynamics and how well LP solutions actually work.

Today, led by a growing number of LP executives, the Loss Prevention Foundation, LP Magazine, FMI, NRF, RILA, and others are coordinating in different ways with the LPRC to use research to eventually provide LP managers the critical process and impact data they deserve.

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Using blade fixtures as an example, there are several specific effort mechanisms of action in play. First, some offenders perceive the blades are locked in the protective fixture. Second, the fixture slows selection rates down by requiring a sequence of movements to select and remove each pack, adding delay time to select each blade pack.

Third, the selection sequence requires two hands to operate the mechanism while removing the blade pack, making item concealment more difficult.

The second mode of action involves increasing the perceived risk of detection, rapid response, and detainment.

The specific risk mechanism is the ratchet noise made when the blade shelf is opened to access a pack, which the subject believes may notify others of the protected item’s access.

The third mode of action is focused on benefit denial by limiting the quantity and possibly damaging the asset, thus reducing the value to the offender for personal use or converting to cash. The mechanism of action here is the fact that the protective fixture slows selection rates down by requiring a sequence of movements to select and remove individual items, which delays the time required to select each blade pack, potentially reducing the quantity of items able to be taken in a “safe” period of time.

Annunciator Treatment. The mode of action is centered on increasing risk. There are two specific risk mechanisms in play. First, when a subject moves in front of the product or pulls on a fixture handle, an annunciator behind them generates a human voice greeting to the product and brand, so the subject must deal with a possible privacy threat from behind. Second, the subject knows the annunciator voice notifies others that someone is accessing the protected.

If-Found Sticker Treatment. The mode of action for this treatment is centered around benefit denial. The mechanism of action involves placement of a sticker on merchandise that is designed to create offender concern by threatening that potential fences and public buyers will not desire stolen goods with a difficult-to-remove sticker asking anyone seeing this item in any store other than the one noted on the sticker to notify that retailer using a toll-free number.

EAS Warning Sticker Treatment. Again, the mode of action is focused on increasing risk. The mechanism of action is a sticker designed to create concern in offenders that unauthorized removal of the marked item will result in a loud alarm at the exit, which would likely prompt employee response and potential apprehension.

Concept to Action

This listing is just part of our efforts here, but I hope it gets more and more LP experts thinking more and more about our critical industry mission. We’re just getting started, so please let me know your thoughts and suggestions at rhayes@lpresearch.org.

In addition, please contact us if you are interested in participating in this year’s Impact conference at the University of Florida in Gainesville October 14 – 16.

The conference brings together over a hundred LP and vendor executives to review past research and brainstorm future projects.

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PARTNERING WITH RETAILERS

By Dave DiSilva

Proactive Online Investigation Tools Criminals use many online venues to sell stolen merchandise, and eBay continues to be the Internet industry leader in the effort to combat it. In our previous column we reviewed how eBay’s Global Asset Protection team effectively partners with over 300 retailers to proactively identify and remove stolen property listed on our site. We reviewed knowing your merchandise, the factors that affect pricing, and locating potentially stolen merchandise through the investigation of listing outliers. The last section demonstrated evaluating a seller’s business plan to determine if it could be profitable using established costing methods. Many of the tools and techniques discussed in last month’s column may be applied to your search of other online venues.

■ Total Profit—The calculator returns an amount of profit or loss

Locating Merchandise Listings Outliers

Craigslist

Once you have a clear understanding of your high-shrink merchandise and true cost, you are ready to locate current listing outliers. There is a tool called ad hunt’r that can help accomplish this. This free classified search tool provides the capability to search many sites by selection, such as All of Craigslist, Amazon, and others. To use the tool, go to adhuntr.com ■ Select the site you wish to search, ■ Enter a product description, and ■ The tool redirects you to the site and all the current listings matching your description.

based on your entries and includes the approximate fees charged

by Amazon.

■ Evaluate Sales Volume—Is the volume and price of the merchandise realistic? Is this plan sustainable?

To notify Amazon of concerns regarding suspected stolen merchandise, follow the hyper link amazon.com/gp/help/reports. You are asked to provide your email, and select the Violation of Rules report. Provide the name of the seller, the order number, and listing ID. There will be an area to input your comments and concerns.

Craigslist is a classified ads website divided into several sections. Sellers may list merchandise for sale, as well as housing, items wanted, services, and discussion forums.

Amazon

Amazon provides a site for individuals to list new and used merchandise on its platform. Small individual sellers of used and new goods go to Amazon Marketplace or Amazon Auctions. Marketplace sellers offer goods at a fixed price, while at Auctions they sell merchandise to the highest bidder. Here’s how to find merchandise on their site: ■ Sign in to your account, ■ Enter the product you are searching (be specific), ■ Select item condition (new or used), and ■ Select Brand.

At this stage you will be provided with listings and the price ranges for the search item. Now you can compare your actual cost information to the selling price to locate those listings that are significantly below your cost and promotions. Select the seller to get seller reviews. Select the Detailed Seller Information link to get additional seller information, including how to contact the seller.

Now that you have identified a seller that is potentially involved in criminal activity, calculate the profitability of the seller. Try using this free Amazon pricing and profit calculator. It will help you to develop a better understanding of the selling price points that are necessary for the seller to achieve a profit. commercebytes.com/cab/tools/calcs/amazon_fee_calculator ■ Item Price—The price listed ■ Cost to Acquire—Calculate the lowest price. Using your cost of an item and knowledge of lowest markdown price, bogo history, and coupons available, calculate the lowest price at which a seller could obtain the product.

■ Shipping Weight—Determine the actual weight of the product and shipping material.

■ Cost to Ship—Determine the approximate shipping cost by carrier minus shipping charged by the seller.

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Dave DiSilva is a member of eBay’s Global Asset Protection team.

Visit us at the NRF Fusion Center during the LP conference 1:30 – 3:00 p.m.

June 12 and 13 in San Diego.

Using the craigslist search tool:

■ Select the region you wish to search.

■ Enter a product description into the search bar.

■ The current listings matching your search are returned.

■ Many of the listings returned include a phone number to contact the

seller. This information may be used to identify the seller.

To notify someone at craigslist of concerns, use the link craigslist.org/feedback and complete the form, which is sent to customer service. Be specific regarding your concerns. You may also email directly to abuse@craigslist.org.

Other Online Tools

Following are a number of helpful free or low-cost online search tools.

■ blackbookonline.info and virtualgumshoe.com—Both provide free

public record searches and direct you to free public record sites based on your input.

■ pipl.com—Provides free public record searches by name, email, user name, or phone.

■ spokeo.com—Searches on email, phone, username, and address.

Requires an annual fee of about $50.

We will post a full list of free or low-cost search tools on our LinkedIn site—eBay Partners with Loss Prevention Professionals—later this month. linkedin.com/groups?gid=2012550&trk=myg_ugrp_ovr

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profile

Kirkland’s Still Going Strong after Nearly 50 Years

By Adam Paul, Contributing Writer

Kirkland’s

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through a mall to get to their cars. We decided that more off-mall stores were the answer. Our customer’s didn’t want to walk through a mall to find us, or park a half a mile away.”

And so McParland found himself at the loss prevention helm of a company that was not only radically changing its product line, but also reinventing itself location wise. No longer could Kirkland’s rely on the security of a mall; they had to look after themselves.

“We had to beef up security due to the fact that we were now in standalone locations,” says CFO Madden. “You’re self-contained.

You have to deal with that.”

Today, of Kirkland’s 320 stores spread across 34 states, a full 282 of them are off-mall locations, meaning that Kirkland’s is very much in charge of its own security…and destiny…at this point.

ounded in 1966 by its namesake Carl Kirkland, Kirkland’s admittedly fills an odd niche in the retail world, although it has steadily become more and more mainstream as the decades have passed. Carl Kirland’s original vision for the store originated in Jackson, Tennessee, with a single store that primarily sold gifts and items meant to be gifted. For nearly twenty years, the store lineup stayed more or less the same—to whit, a 1979 catalog bore the slogan, “We sell everything from fruit to nuts,” it’s cover depicting a tin of candy, a jar of almonds, a plush toy turkey, and a plastic thermometer—eclectic, to say the least.

In the early 1980s, as Kirkland’s further expanded, it began to also expand it’s repertoire of products, venturing further and further into home décor item sales space to evolve into what it is today—primarily a retailer of home décor, while still maintaining a supply of “giftable” items, for lack of a better term.

The lay of the land where it pertains to loss prevention efforts at Kirkland’s is fairly typical of a company that was founded by a single individual, and then saw expansion in fits and starts over the years; namely, not much thought was given to loss prevention until its current head of LP, Bill McParland, joined the company eleven years ago.

“My initial field visits found that while the stores had dedicated procedures in place to try to control theft, the field was lacking the core understanding and focus of loss prevention,” says McParland.

He is a career loss prevention professional, having held senior positions in LP at such companies as Payless Shoe Source and G&G Shops, and he also holds a bachelor of science in law and justice for good measure. “When I started at Kirkland’s in 2002, we had exactly one auditor and one admin person working loss prevention.

We didn’t have a strong LP presence,” states McParland.

Bill McParland found himself at the loss prevention helm of a company that was not only radically changing its product line, but also reinventing itself location wise. No longer could Kirkland’s rely on the security of a mall; they had to look after themselves. “We had to beef up security due to the fact that we were now in standalone locations,” says CFO Mike Madden. “You’re self-contained.

You have to deal with that.”

Mall Exodus

A big reason that Kirkland’s began to take a more serious look at loss prevention is that in 2005, it slowly began to detach itself from its roots as an exclusively mall-based operation. Up until that time, Kirkland’s had some two hundred odd stores with 95 percent of them located inside malls, primarily in the Southeast.

In a matter of speaking, much of Kirkland’s original LP methodology relied on the mall itself to safeguard its operation.

Malls provide a measure of security for tenants; they are well lit, indoors, usually have robust security measures, and more or less allow the tenant to hang their LP hat on whatever the mall is doing. Kirkland’s chief financial officer and the man McParland’s reports to, Mike Madden, muses on the subject of Kirkland’s early mall days. “Malls provided us with lots of security, but you pay for it, and some malls are better equipped than others,” says Madden.

“We started realizing that our customers were coming to visit us. The casual mall walker no longer drove our business. We had become a destination shop,” says McParland of the decision to begin ushering in new off-mall locations. Quite simply, Kirkland’s collectively woke up one day and realized that they had their own following of loyal customers; ones that weren’t tied to impulse buying or random shoppers walking through a mall. So they decided to slowly detach from the mall experience.

McParland adds, “As we started selling larger home décor items, it began to be impractical for Kirkland’s to display the items in a small store footprint and for customers to wheel those items

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Bill McParland

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Kirkland’s

One would think that home décor items wouldn’t necessarily represent an appealing target for the casual thief or especially organized retail criminals, but that isn’t really the case. “That’s a common misconception,” states McParland. “Twenty-five percent of our store items are framed items, such as art or mirrors.

They go missing two to four at a time with a price point of between $40 and $200.”

LP Challenges

One would think that home décor items wouldn’t necessarily represent an appealing target for the casual thief or especially organized retail criminals, but that isn’t really the case. “That’s a common misconception,” starts McParland. “Twenty-five percent of our store items are framed items, such as art or mirrors. They go missing two to four at a time with a price point of between $40 and $200.”

Recently, some employees were resetting a store display and placed a $400 pedestal sink close to the front door; it was quickly stolen, demonstrating the age-old loss prevention axiom that regardless of the product, if it isn’t bolted to the floor, it’s ripe for theft.

McParland is keenly aware that this sort of pilferage is simply a part of retail business and doesn’t let it get in the way of the customer experience that Kirkland’s strives to create. While

McParland could turn your average Kirkland’s store into Fort Knox, he doesn’t much believe in an overbearing security presence within the stores. “We sell products that people want, not products that people need,” he explains. “We want to make every store experience special for the customer. The last thing we want to do is hamper our store teams.”

McParland has also seen a demonstrable shift in pilferage that closely parallels Kirkland’s inventory transformation. Consider that in the past, Kirkland’s stores mainly sold lower cost gift-style items.

Yet today, the stores are filled with high-end pieces of furniture and décor items that can cost $500 or more, which changes the loss prevention landscape and the potential losses.

Three years ago McParland decided to implement a store-wide CCTV program. At the same time, he’s decided that technology, such as RFID, really doesn’t work for a store like Kirkland’s, simply because of the uniqueness of the product they sell and the way the stores operate with constant shifting of their product offering throughout the store. “We don’t hold product for a very long time, and our store setups are very fluid,” states McParland.

Internally, Kirkland’s has its share of employee theft and the challenges associated therein. Once again, because of Kirkland’s home décor specialty, certain theft scenarios occur that are peculiar to such a store. McParland describes a recently thwarted theft ring in some of Kirkland’s stores, wherein a group of employees were regularly propositioning customers to purchase goods on a cash basis, essentially removing the register from the equation.

“People often come to Kirkland’s to decorate an entire room or home. We had some employees who would try to make them a cash deal on product they were after,” he says. Thankfully, in some of those cases, the employees were exposed by Kirkland’s own loyal customers, who felt ill at ease giving cash directly to sales employees and not receiving a receipt.

McParland also has to deal with the fencing of Kirkland’s products, which occasionally occurs. “Employees have been found taking products out of the store, hiding them in storage units, and then selling them at flea markets or other small mom-and-pop shops that either they or friends may own,” states McParland.

“Our customers or other alert employees have actually reported these items for sale.” Once again, this demonstrates the integrity and loyalty of your average Kirkland’s shopper or store teams.

McParland’s team also regularly monitors Internet sales of their products on sites like eBay and Amazon, always keeping a close eye on the resale of all things Kirkland’s.

Risk Management

McParland’s full job title is senior director of loss prevention and risk management. The risk management responsibility was added to his plate because that’s where Kirkland’s was experiencing some of its highest losses. “I picked up safety six years ago, and risk management three-and-a-half years ago,” he says, noting the fact that the average Kirkland’s employee is exposed to a potential myriad of safety considerations.

“We sell heavy items, glass items, and other merchandise that can hurt employees. We’ve have numerous 40-pound items, with additional new items hitting the stores weighing up to 100 pounds or more,” states McParland, explaining why a major thrust of his department is now workplace safety. Kirkland’s store employees

LP Magazine | May - June 2013

43

Kirkland’s aren’t dedicated cashiers, stockroom workers, or retail sales people.

All employees are expected to move items, assist in customer carry outs, and reset the stores, often on a daily basis, which exposes them to all sorts of potential injuries.

Due to these considerations, McParland’s team has implemented a comprehensive employee training program, making sure that each employee knows how to properly lift heavy items, handle broken sharp items, and use proper ladder techniques, thus setting policy for company safety in general.

It’s easy to see why things like theft and ORC are on McParland’s mind, but are not the sole focus of his LP efforts. “A picture frame may cost $19.99, but it’s a six-figure claim when someone falls off a ladder trying to retrieve that single frame,” explains McParland. “Ten internal theft cases don’t even approach the financial loss possibility of one severe workers’ comp claim.”

As Kirkland’s product line shifted, so too did McParland’s job focus. Today, he spends as much time dealing with safety and workers’ compensation issues as he does thinking of things like pilferage, employee theft, and ORC. It’s just that important.

Following this line of reasoning, McParland confesses that his CCTV rollout was as much for store employee and customer safety as it was for guarding merchandise and robbery deterrence.

Kirkland’s actively uses its cameras as protection for customers and sales associates. Accidents or mishaps can now be examined in excruciating detail to both determine their cause as well as ensure that action is taken to prevent it from happening again.

“We sell heavy items, glass items, and other merchandise that can hurt employees,” states McParland, explaining why a major thrust of his department is now workplace safety. Kirkland’s store employees aren’t dedicated cashiers, stockroom workers, or retail sales people. All employees are expected to move items, assist in customer carry outs, and reset the stores, which exposes them to all sorts of potential injuries.

Current Team

Kirkland’s current loss prevention team, headed by McParland, is comprised of both field people and professionals based at the corporate office level. At their Nashville-based home office, one investigator is in charge of monitoring Kirkland’s custom-built exception software program. Another LP supervisor, supported by an administrative assistant, is focused on bad checks, security equipment, e-commerce fraud, credit card scams, and all administration functions.

There are also two field LP professionals—one whose main focus is store and distribution center safety and all aspects related to it, and another who is pure loss prevention. For risk management, McParland utilizes a claims manager and claims specialist to investigate and resolve the numerous incidents reported annually, whether for workers’ compensation, general liability, product liability, property damage, or their fleet vehicle program.

Kirkland’s team at first glance appears to be on the small side, especially considering it has 320 stores across the nation, but that’s because McParland’s focus is based more on a cadre-type group of trainers as opposed to an in-store security force.

McParland and his team spend much time on the road, hitting multiple stores, and training the store management so that they can better control their own stores, not only for crime and theft, but for safety-related issues as well.

“The store manager is the captain of that store,” explains McParland. “We train them to a very high level, because they are responsible for everything that happens in that store. We not only show them what to look for, we show them what we look for.”

In this sense, McParland’s team isn’t as small as it appears at first

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glance, considering that each of Kirkland’s 320 store managers also has an LP focus.

The store managers aren’t the only focus of McParland’s training efforts, “We train everyone from the store manager down to our part-time assistant,” he states. McParland’s team leaves no store unturned in their quest to indentify and rectify all of the store’s problems, from ORC all the way down to irate customers. This isn’t to say that Kirkland’s loss prevention team does not have a primary focus on theft and crime. To whit, all of Kirkland’s field people are part of the loss prevention team.

McParland’s training cadre is an interesting loss prevention concept to say the least. While the team itself is relatively light, its main asset is that it imparts a wealth of training knowledge to the individual stores, making it a real heavy hitter. It’s as if McParland realizes that LP personnel can’t be in all 320 stores at the same time, so the best thing that he and his team can do is equip each store with the knowledge it needs to fend for itself, while still continued on page 46 |

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Kirkland’s

ten percent in square footage alone last year,” says Madden.

“We’re very pleased, and we continue to adapt.” A ten percent increase in the square footage of Kirkland’s stores is formidable, considering that the country was in the midst of what is supposed to be a down economy. “Normally, we feel the impact of the economy before others do,” adds McParland, alluding to the eclectic nature of the store’s offerings.

On the one hand, Kirkland’s growth presents a range of challenges to McParland’s team, mostly because Kirkland’s isn’t so much growing as it is transforming. The average refund-fraud case is a several thousand dollar event today rather than a several hundred dollar event ten years ago. This is not so much because the crooks are smarter (they aren’t), but because the average ticket item of the product Kirkland’s sells is much higher than it was years ago.

Still, McParland’s team has kept pace with it all, charged with a mission to relentlessly educate Kirkland’s employees, which ultimately brings everyone in as a loss prevention partner, shattering the old adversarial “us-versus-them” LP mentality.

There are no cops-and-robbers-style loss prevention tactics at work at Kirkland’s; only a dedicated team of seasoned trainers who share the most important weapon they have—their knowledge—with Kirkland’s employees. “We’re all in this together,” states McParland, succinctly painting a picture of his loss prevention and risk management vision.

There are no cops-and-robbersstyle loss prevention tactics at work at Kirkland’s; only a dedicated team of seasoned trainers who share the most important weapon they have— their knowledge—with Kirkland’s employees. “We’re all in this together,” states McParland, succinctly painting a picture of his loss prevention and risk management vision. continued from page 44

having unbridled access to the LP team when required. “We react to what’s draining our profitability. There are so many areas besides theft where this happens,” adds McParland.

CFO Mike Madden adds, “We spend money where it’s needed.

Our shrink has remained constant even though we’ve transitioned out of the malls, and there are far more obstacles in locations outside the mall.” Kirkland’s is also actively growing. “We grew

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ADAM PAUL is a business writer based in Los Angeles, California, and an ongoing contributor to LP Magazine.

He can be reached at AdamP@LPportal.com. |

LPportal.com

My Turn

By Kevin M. Plante, LPC

Have a Networking Plan and Work It Before You Need It

I

f you were training for a marathon, when would you start? A day before the race? A week? I would think not if you actually want to be successful. What if you had never run for any long distances before? Would you need three months to get ready? Six months or even a year? If you really want to run well and have a relatively good chance of finishing (or surviving) the marathon, you probably need the better part of a year to train under normal circumstances. That said, why would you wait until you need to look for a new job to begin networking with people who could help you?

It is important, all the time, to not only have a plan, but to work that plan. Following are five tactics I recommend to successfully work a networking plan.

Use social media tactically and regularly. Consider having a strict policy of only having friends and family connected to you on Facebook. You probably don’t want your boss seeing pictures of you from high school or from a New Year’s Eve party. Use LinkedIn as your outlet of choice for professional contact management and staying in touch with colleagues. Get in the habit of updating each regularly so people can read about what is going on in your life at their leisure.

Over the last few years many loss prevention professionals have found themselves victims of reorganizations, downsizing, condensing, and shrinking departments that have put them on the unemployment line.

Once the shock of it all sets in and the realization of what happened is understood, you need to figure out what your next steps should be. It’s important to ask for help. Find out what opportunities are out there. Talk to people. Call recruiting agencies.

The question a lot of people would ask is “How many places do you have to go to ask for help or to find out where those jobs are?”

The answer is easy…if you haven’t networked yourself properly, you may have unintentionally limited your resources.

If you find yourself in the unfortunate position of looking for employment, you will most likely ask yourself, “Now what do I do?” The first thing you should do is reach out to your contacts and ask for help. The better you’ve networked leading up to that point, the better chance you’ll have of getting the help you need.

What Is Networking?

When people hear the word “networking,” they usually think about social media like Facebook and Twitter for their personal contacts and LinkedIn for staying in touch with their professional contacts. These social media options are a lot of fun and are a great way to give people an opportunity to keep up with others, no matter what they do or where they go. But there is so much more to networking than that.

When someone I worked with almost twenty years ago telephoned me out of the blue one day, it took me a few minutes to even place the name with a face in my mind. Once I remembered how I knew this person, there was a little small talk, like “How’s the family?” and “Do you have kids?” Then the reason for the call started to become clear. “Hey, uh, I just lost my job last week and was just calling to see if you happened to know of any positions in your company that I might be a good candidate for?” may - june 2013

I most certainly would want to help this person, but, truth be told, if I had other colleagues who I knew better wgo were in the same position of looking for employment, wouldn’t I be inclined to help them first? Of course I would.

Five Elements of Networking

A Difficult Time

48

Plante is director of LP financial reporting and analytics for CVS Caremark. He joined CVS this past January after fourteen years with Staples where he held multiple management positions, most recently manager of U.S. retail LP operations. He also held LP positions with BJ’s Wholesale Club and Marshalls and Caldor. Plante began his career in retail as a pick up window checker with Sears and Roebuck during college. He can be reached at 401-770-8083 or kevin.plante@cvscaremark.com.

Find local events that offer situational networking and information sharing. I like to go to regional law enforcement meetings, smaller retailer meetings at malls, and the Retailers Association of Massachusetts LP committee events, which is the state-level LP organization where I live. We have quarterly meetings that combine learning, information sharing, and networking. The people who go to those meetings represent many of the major retailers in New England and many law enforcement agencies. There is nothing like putting a name to a face and giving out business |

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cards offering to help, as well as collecting business cards in case you need them someday.

Attend professional conferences. ASIS, CFI, NRF, RILA, and others all hold annual national conferences. Organized retail crime associations have sprouted many regional conferences throughout the U.S. that you can attend each year. Each conference is an opportunity for education and networking. All associations are aware of each other’s events, so events are usually spread evenly throughout the year, giving you multiple opportunities to get to at least one or two per year. If you hold a professional certification, you may also find these eligible for use as continued education units (CEU) toward your recertification.

Work with area colleges. Find a college in your area that has a criminal-justice or retail management program and offer to mentor aspiring loss prevention professionals. It may help you because not only do you get to know students, but you also get to know professors and department heads in the school. All of these people could help you if you found yourself in need of employment as well as if you were in need of good advice on continuing your education. Who knows, maybe teaching at the college level could be something you might decide to do someday.

Talk to people in person. There are so many ways to communicate with people at an impersonal level, including texting, email, and messages through social media. But what about the old-fashioned way, like picking up the phone and calling people, or, better yet, meeting them face-to-face if you can?

Determine the twenty people you really want to keep in touch with and can help you. Maybe you admire them because they’re smart, work for a great company, or have been in the business for years. Be aware that your twenty-person list will likely change over time. Call them or try to get together for coffee. Find one hour on one day each week and make those phone calls. By the end of the month, you’ve talked to all twenty people and have likely had a meaningful conversation with them.

Start Training for Your Marathon Now

So, what happens when you successfully navigate these five elements of networking? You get to know people, and they get to know you. You become a resource for people because they get an idea of what your experiences and expertise are while you learn from them. Maybe you find one of them a position at your company, or perhaps you find a friend of theirs a position where you work or at another company based on information you heard from another contact. Now your network is larger and people know who you are.

If you find yourself in the unfortunate position of looking for employment, you will most likely ask yourself, “Now what do I do?” The first thing you should do is reach out to your contacts and ask for help. The better you’ve networked leading up to that point, the better chance you’ll have of getting the help you need.

There’s an old saying that says, “It’s not what you know, but rather who you know.” When you need to differentiate yourself from a hundred other people with similar experiences and education, it does help to know someone.

Don’t wait until you need to network. Instead, make networking part of your regular routine. Start today because you never know when your marathon will need to be run, and you’ll need to be in great shape for it.

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LP Magazine | May - June 2013

The Right Combination 49

       

       

             

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Dr. Richard Ofshe Dr. Richard Ofshe False Confessions False Confessions  

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Dr. Carole Chaski Dr. Carole Chaski Linguistics Linguistics

Michael Reddington, CFI Michael Reddington, CFI Applying Communication Theory Applying Communication Theory to Interview and Interrogation to Interview and Interrogation

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 

John Guzman, CFI John Guzman, CFI Gang Investigations Gang Investigations

Wayne Hoover, CFI and David Zulawski, CFI Wayne Hoover, CFI and David Zulawski, CFI Tying It All Together Tying It All Together “The most refreshing thing about the training was the passion “The most speaker refreshing thingfor about thegiven training wasEven the passion that each shared their topic. if their that speaker shared for theirofgiven topic. Even if their viewseach conflicted with the majority the audience.” views conflicted with the majority of the audience.”

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“A training seminar that went above and beyond what is typi“A training seminar that went above andtraining. beyondThis whattraining is typically thought of in regards to interview cally thought of in regards to interview training.

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Tooand often it seems like some are always work.

Too often it seems like some trainings are always the same thing over and over again. With this, it was newsaying inthe same thing overperspectives. and over again. formation and new “ With this, it was new information and new perspectives. “

  

    

 

    

Feature

Negotiate Like an

Interrogator

By Michael Reddington, CFI

Negotiate Like an Interrogator

N

and capitalize on effective questioning techniques to close the deal.

When applied properly, these skills empower LP executives with significant advantages over their negotiation counterparts.

egotiation is synonymous with terms ranging from compromise and mediation to haggle and…interrogation.

It is not difficult to argue the fact that interrogations represent the hardest form of negotiating. When people enter into negotiations or mediations, they understand they may need to sacrifice some of their interests in order to reach a mutual agreement because both parties, at some level, have shared interests.

On the contrary, when subjects enter into interrogations, they have no intentions of sacrificing any of their interests. Interrogation subjects are typically motivated to stake themselves to a position of innocence and to vehemently defend that position. Skilled interrogators overcome these obstacles by creating shared interests, reducing their subject’s resistance, and creating perceived benefits for confessing.

Many corporate executives view negotiating skills as both critical to their success and a significant developmental opportunity.

According to Northwestern University Professor Victoria Medvec, over 80 percent of CEOs leave money on the table. These executives list nerves, tension, confrontation, pressure, and lack of information as obstacles impeding their ability to succeed in negotiations. LP executives have distinct negotiating advantages as they have experience overcoming confrontation, managing their emotions, and often operating without a clear picture during their interrogations.

In their groundbreaking book, Getting to Yes, Roger Fisher and William Ury state that “the reason you negotiate is to produce something better than the results you can obtain without negotiating.” LP executives have several opportunities to improve their negotiation results, including understanding how often they have opportunities to negotiate, identifying methods to maximize their interests, and applying their interrogation skills to negotiations.

Experienced interrogators may avoid using their skills in negotiations because they do not want their counterparts to feel like they’re

Preparation and Planning

Interrogators and negotiators should say or do nothing by accident—nothing. Planning for negotiations is nearly identical to planning for interrogations. The ability to succeed in either setting is heavily predicated on the soundness of the initial strategy. The central idea behind preparing for any interrogation is to establish what this subject needs to hear and experience to believe it’s in his or her best interests to tell the truth. Similarly, the central idea behind any negotiation strategy is to establish what this person needs to hear and experience to believe that it’s in his or her best interests to agree to as many of your interests as possible.

Interrogation strategies are not developed around positions; they are developed around creating the perception of shared interests and benefits. A positional interrogation often starts with the interrogator asserting the subject’s guilt and the subject asserting their innocence in response. Positional interrogations quickly devolve into did-not, did-to conversations and rarely end with fully developed confessions. Conversely, interest-based interrogations allow interrogators to develop rapport, show understanding, and convince the subject that the interrogator cares about him or her.

Positional negotiations pose similar challenges. Fisher and Ury contend that negotiations can be judged by answering three questions: ■ Did it produce a wise decision?

■ Was it efficient?

■ Did it improve the relationship?

Positional negotiations generally fail to meet these standards.

As soon as negotiators dig themselves into positions, they force themselves to defend them in order to save face.

Taking positions creates an anchoring effect.

A reasonable anchor provides negotiators with a fair starting point from which to make concessions. An unreasonable anchor can damage relationships, inhibit agreements, and potentially end a negotiation before it starts.

Accordingly, positional negotiations often end with no, or suboptimal, agreements for both parties. However, negotiations built upon shared interests allow both parties to establish rapport, show understanding, and build toward optimal agreements through creative problem solving.

One significant difference between interrogations and negotiations is the importance of creating lasting relationships. Most interrogators only need to create a positive relationship with their subjects for several hours to accomplish their goals. At the conclusion of the interrogation, the subject is typically terminated and the ongoing relationship diminishes in importance.

Negotiations are the exact opposite. Every negotiation represents one link in a chain of ongoing negotiations. Most negotiation counterparts are business partners. Whether negotiating with vendors, peers, superiors, or subordinates, negotiators need to maintain positive working relationships. Negotiators need to look at the big picture and determine which of their interests are most important, which

The central idea behind preparing for any interrogation is to establish what this subject needs to hear and experience to believe it’s in his or her best interests to tell the truth.

Similarly, the central idea behind any negotiation strategy is to establish what this person needs to hear and experience to believe that it’s in his or her best interests to agree to as many of your interests as possible. being interrogated, they don’t feel comfortable adapting the techniques, or they feel their title allows them to make demands.

Opportunities to negotiate present themselves daily. These include setting budgets, annual goals, vendor contracts, salaries, schedules, responsibilities for merchandise protections standards, and inventory reconciliation. Standard interview-and-interrogation methods and skills can easily be adapted to provide structure to negotiations.

Accomplished interrogators develop the ability to see the big picture and create actionable game plans. They control the conversation, reduce resistance, interpret physical and verbal communication,

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Negotiate Like an Interrogator interests can be sacrificed the easiest, and how can they manipulate multiple negotiations over a period of years to achieve their ultimate goals. Negotiators love to see their counterparts make concessions.

On occasion it may be prudent to concede on several issues, or an entire negotiation, to allow your counterpart to feel like they have “won” and build personal equity for future negotiations.

Identifying Your Goals. The first step in preparing for a negotiation is to identify your long- and short-term goals. These goals should include what you really want, what you will be satisfied with, what you need, and what is the minimum agreement you’ll accept. It’s critical to develop, what is commonly referred to as your best alternative to a negotiated agreement (BATNA). Your BATNA represents your next best option should this negotiation end in an impasse. The amount of leverage either party has during a negotiation is directly related to the strength of their BATNA. Creating Your Offers. Once your BATNA is established, the next step is to create, what Dr. Medvec refers to as, multiple equivalent simultaneous offers (MESOs). These offers allow you to aggressively negotiate multiple issues at the package level while signaling cooperation and identifying your counterparts priorities. These MESOs provide a platform to make future concessions from while attending to your largest interests.

In the Art of War, Sun Tzu states, “If you know your enemy and you know yourself, you will never be in peril in 100 battles.” Additionally, he states that “If you are ignorant of the enemy, your chances of winning or losing are equal.” Finally, he adds, “If you are ignorant of yourself and your enemy, you will be in peril in every battle.”

zero loss.

Interpreting Physical and Verbal Behavior

Interrogators are consistently observing their subject’s physical and verbal behaviors for signs of potential deception, submission, and denials. Every interrogator should understand there is no

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Understanding Your Opponent. Understanding your needs, goals, and BATNA is only 50 percent of the equation.

It is equally important to consider the opposing party’s needs, goals, and BATNA. Evaluating their objectives allows negotiators to anticipate what positions their counterparts would like to take and what interests may drive their counterpart’s decisions.

This provides negotiators with the opportunity to use their counterpart’s interests as a means to lead them away from their positions and into the negotiation. Juxtaposing a negotiator’s goals and needs with their counterpart’s goals and needs should identify shared interests to build the negotiation upon. These shared interests may be economical, goal driven, to ease tension, to improve visibility, or to create career opportunities.

Choosing Time and Setting. Establishing a negotiation strategy includes determining who to speak with, when to speak with them, and where to have the conversation. It is important to choose a counterpart who is most likely to be an advocate for your interests.

This could mean negotiating directly with the decision maker, or negotiating with someone who can influence the decision maker’s thinking. Negotiators should attempt to choose a time and location for the negotiation that will benefit their interests. This may not always be possible. However, it is important not to underestimate the effect the time and setting can have on a negotiation.

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Negotiate Like an Interrogator they haven’t come to your side just yet, but they are on the fence and are only a few good reasons away from jumping to your side.

single behavior that indicates truth or deception. Interrogators know they must establish their subject’s behavioral norm and create a baseline to evaluate future behavior against. They look for behavioral clusters, or multiple behaviors, that deviate from the baseline on time to specific stresses and evaluate them within the totality of circumstances to derive their meaning.

Negotiators can benefit from employing this skill set. LP executives need only to change their focus from “detecting deception” to “detecting discomfort.” Negotiators can establish a behavioral norm at the start of a negotiation by asking their counterparts several questions they should have reason to lie about. These questions could involve the weather, traffic, sports, recent company events, or employment information. Once this norm is established, negotiators can evaluate future reactions to their statements and gauge their counterpart’s level of acceptance or resistance.

Warning signs of impending denials during interrogations are the same as warning signs of impeding interruptions during negotiations. Emphatic denials are preceded by subjects shaking their head, taking a breath, and pressing their lips to prepare to speak. Other common precursors include furrowing of the eyebrows or aggressive eye contact.

These same behaviors occur during negotiations when negotiators say something their counterpart disagrees with. As soon as negotiators see these physical responses, they should politely raise their hand, turn their head, speak their partner’s name, and ask them to continue to listen. When negotiators stop objections, they stop their counterparts from staking themselves to a position they will be forced to defend, keep control of the conversation, and create an opportunity to reduce their counterpart’s resistance by focusing on shared interests and opportunities.

Negotiations are two-way conversations as opposed to interrogations that are typically monologues. The increased dialogue during negotiations makes recognizing verbal cues much more relevant. Negotiators should be ready to react as soon as they detect frustration or anger in their partner’s tone of voice. This may be a signal for the negotiator to introduce additional benefits or focus on another area until the tension has passed. Negotiators also want to evaluate their counterpart’s tone in comparison to the specific words spoken, as it may indicate a lack of confidence or a question that can be exploited.

Specific denials present further opportunities to negotiators.

Listen for statements like “I can’t get it done that fast,” “I can’t go quite that high [or low],” or “I can’t give that many.” Each of these statements are indications that they are willing to do part of what you’re requesting, and now you need to provide them with reasons to move toward fulfilling your complete request.

Other responses of interest may include “I would rather not,” “I would prefer a different option,” and “I really don’t want to.” These statements are not denials or refusals. These are indications that

Reducing Resistance to Your Interests

The quickest way to obtain admissions during an interrogation is to allow subjects to feel better about what they have done. This is accomplished by providing them with reasons or excuses to physiologically minimize the seriousness of their actions. The quickest way to achieve an agreement during a negotiation is to allow your counterpart to feel better about sacrificing some of their interests.

Negotiators benefit greatly from operating under the following philosophy: Focus on the issue, not the person; focus on the resolution, not the consequences.

Focusing on the issue removes emotions and personal attacks from the conversation and avoids causing your counterpart to feel the need to defend themselves. Focusing on the resolution keeps everyone moving toward the end goal, whereas focusing on consequences forces people to take and defend positions.

People generally expect negotiations to become adversarial conversations. By focusing on the issue, not the person, negotiators gain an advantage by creating a level of cognitive dissonance for their counterparts. This occurs as they try to reconcile their expectations of an adversarial conversation with their new reality of a collaborative conversation.

For subjects to admit to dishonesty during an interrogation, they must convince themselves that the perceived benefits of admitting outweigh the perceived consequences of not admitting. This principle holds true in negotiations.

For your counterpart to agree to favorable terms, you must

Accomplished interrogators develop the ability to see the big picture and create actionable game plans. They control the conversation, reduce resistance, interpret physical and verbal communication, and capitalize on effective questioning techniques to close the deal. When applied properly, these skills empower LP executives with significant advantages over their negotiation counterparts.

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convince them that the perceived benefits of accepting the agreement outweigh the perceived consequences of refusing the agreement. As a result, your approach to any negotiation should focus on the other party’s benefits, not your own. Negotiations focused on positions often create lose-lose agreements for everyone involved. Each party stakes themselves to a position early, digs their heels in, and forces the other party to drag them toward the middle.

This strategy typically results in both parties leaving potential value on the table and realizing the full potential of the negotiation. continued on page 56 |

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Negotiate Like an Interrogator continued from page 54

Effective Questions

The key to reducing your counterpart’s resistance is understanding the motivations behind their resistance. When your counterpart shows resistance to one of your ideas, ask yourself: “Why would someone like that be resistant to an idea like this, in this current situation?” The answer may be expenses, time commitment, maybe they are afraid to lose face in front of their boss, previous negative interactions, or maybe they just need a couple minutes to think the offer through. Once negotiators understand the motivation

Direct questions get direct denials. Questions that can easily be answered with either a “Yes” or a “No” should be avoided in any negotiation or interrogation. We have all been operationally conditioned to say “No” since we were children. Interrogators know if they ask someone “Did you…” or “Can you…,” it sounds as if the interrogator isn’t sure of what he or she is asking. When interrogators ask assumptive questions, such as “When was the first time…” or “How often…,” they sound as if they already know what happened and are looking for supporting information. Assumptive questions often get mislabeled as accusations.

Negotiations provide endless opportunities to employ assumptive questions to expand agreements, gain acknowledgment of alternatives, and lock negotiation counterparts into facts.

While negotiating with a vendor, an executive may ask, “Can you please include twenty additional units at the same cost?” Or worse, “Are you sure you can’t add twenty more units for the same cost?” Each of these questions will likely be met with a resounding, “No.” A far more effective way to make the same request would be to preface it with a brief, third-person anecdote illustrating mutual concerns to reduce the vendor’s resistance in advance of the request.

This rationalization is then immediately followed with an assumptive question, such as, “How many extra items can we add to the current proposal to finalize the agreement?” As soon as the vendor hesitates, the negotiator should exaggerate by saying, “I’m sure we can’t go as high as thirty items, right?” When the vendor agrees with the follow up question the negotiating executive should support his statement and continue with another assumptive question, such as, “I didn’t think so, but how much longer would the shipment take if we added twenty items?”

When negotiators continue this cycle of minimization statements and assumptive questions, they reduce the ability for their counterparts to take positions and focus the conversation on maximizing mutual interests. Employing assumptive questions also allows negotiators to focus on multiple offers simultaneously and achieve agreements to ancillary issues while building momentum toward the final agreement.

The quickest way to obtain admissions during an interrogation is to allow subjects to feel better about what they have done. This is accomplished by providing them with reasons or excuses to physiologically minimize the seriousness of their actions. The quickest way to achieve an agreement during a negotiation is to allow your counterpart to feel better about sacrificing some of their interests. behind the resistance, they can effectively rationalize to reduce it by openly acknowledging the root cause.

Prevailing wisdom has held that people make decisions based on reviewing available information and drawing logical conclusions. With his “narrative paradigm” theory, Walter Fisher proposes that people are storytelling animals who make decisions based on good reasons. The significance people place on information and good reasons can vary. However, there is little doubt that compelling stories can be far more persuasive than simply presenting someone with a set of numbers or facts.

Closing the Negotiation—Applying the Participatory Interview

The various forms of negotiation are infinite. As a result it is impossible to point to one technique that can be used for maximum effect in any negotiation. Some negotiations will require you to take the lead, while others require negotiators to allow their counterparts to lead. Some negotiations will call for bigger sacrifices in the short term to obtain larger long-term gains. Still other negotiations may force negotiators to fight hard for valuable interests.

Most interrogation techniques can be modified to assist in virtually any of these scenarios. The participatory technique adapts well to negotiations. The principle behind the participatory

Hear More This is especially true with negotiations because people from Michael Reddington have to live and work with their decisions long after the initial

Every week Michael Reddington offers his agreement been see aon significant drop insightshas into all made. thingsNegotiators interviewing the “W-Z inTip theirofcounterpart’s resistance when they deliver third-person the Week” segment of the magazine’s anecdotes andpage. minimization statements thatevery provide compelling EyeOnLP Visit LPportal.com Thursday reasons for their counterparts to view issues from their for a new video or scan the QR code above. perspective.

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continued on page 58 |

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Negotiate Like an Interrogator continued from page 56

Negotiations are all about relationships.

Negotiators need to check their egos at the door, avoid taking positions, find creative ways to maximize interests, and cause their counterparts to feel good about conceding their interests.

Remember, negotiating is not about making your counterparts feel like they have lost. Negotiating is about making your counterparts feel like they won by agreeing to your interests.

interrogation technique is to lock subjects into a story, series of events, or clear understanding of procedures before accusing them of any wrong doing. Negotiators can reverse engineer agreements using their counterpart’s interests, motivations, and resistance to their advantage by locking their counterparts into an agreement before making a proposal. It is much harder for your counterpart to reject your proposal if they have previously agreed to the reasons and principles behind it.

It is safe to say that everyone likes getting paid more money, so we will use a salary negotiation as a template to demonstrate how this technique works. For example, let’s say you’ve been promoted to a regional LP manager position, and you walk into the director’s office to discuss your salary.

You will surely not receive a satisfactory answer if you open the conversation with, “Can you please pay me more money?”

A more productive route to take would be to prepare in advance by considering what factors go into salary increases and why the director would feel good about agreeing to an increase. These factors may include number of stores, sales volume, shrink percentage, geographic location, relocation, tenure, travel obligations, and the visibility of the role. Reasons the director may feel better about providing the increase could include seeming fair, adhering to precedents, providing motivation, or rewarding loyalty. After considering the key factors and reasons, choose the best time and location for the conversation.

You may start the negotiation by saying that you want to make sure you understand how to fairly assign compensation and asking him what factors he would consider before approving an increase. As he answers, take your time and walk him through each of the factors you prepared. After he agrees with these factors, follow up by discussing reasons to ensure salaries are commensurate with the factors you just discussed. By agreeing with these reasons and factors, the director has painted himself into a corner. It will be hard for him to contradict himself and refuse your request for a salary increase.

Now that you have prepared your counterpart to receive your request you may ask, “Great, I am glad we are in total agreement and based on this discussion how large an increase can you approve for me?” When your director pauses, say “I’m sure we can’t go as high as $10,000 right?” Support your director when he says “No” and begin to rationalize toward a smaller number.

Focus on how the increase will benefit him and the organization, how the factors you previously discussed apply to you, and how you plan on earning the increase moving forward. Once it appears that his resistance has been reduced, pose another assumptive question, such as “What kind of

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an increase do you feel would be appropriate?” When he hesitates, exaggerate with something like “Do you think it could be as much as $7,500?” When he says “No,” tell him that you completely understand and suggest $5,000.

If your director appears to be on the fence, be prepared to offer performance benchmarks you would need to hit for the increase to take effect. The open dialogue allows you to introduce paid time off, a company vehicle, or other potential benefits into the conversation.

Conclusion

There is no single solution for adapting interrogation techniques to negotiations. The totality of circumstances surrounding each negotiation needs to be considered before choosing the appropriate technique. A well-rehearsed game plan provides negotiators with confidence and a path to success.

When adapting interrogation techniques to negotiations, it is imperative to make sure your counterparts do not feel like they are being interrogated. Negotiators who capitalize on their counterpart’s behavior, reduce resistance, and use assumptive questions give themselves greater chances to be successful.

Finally, negotiations are all about relationships. Negotiators need to check their egos at the door, avoid taking positions, find creative ways to maximize interests, and cause their counterparts to feel good about conceding their interests. Remember, negotiating is not about making your counterparts feel like they have lost. Negotiating is about making your counterparts feel like they won by agreeing to your interests. To quote Sun Tzu: “To subdue the enemy without fighting is the acme of skill.”

MICHAEL REDDINGTON, CFI is the director of investigations and consulting for Wicklander-Zulawski and Associates. In addition to conducting seminars, his responsibilities include coordinating investigations in both the public and private sector, maintaining the company website and blog, and pioneering new applications for W-Z techniques in corporate settings. Reddington held loss prevention positions with Sears and Bloomingdale’s before joining W-Z. He can be reached at 800-222-7789 x125 or mreddington@w-z.com.

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LPportal.com

Solutions Showcase Axis Communications

The Rapidly Growing Benefits of IP Cameras in the Retail Industry

S

ince their invention in 1996, IP cameras have faced a difficult challenge in trying to gain traction alongside the well-established analog camera market…especially in retail.

Analog was king when it came to the surveillance industry. But over the past decade, with improvements in image sensors, lens quality, and adherence to new high-definition standards, IP camera image clarity and performance caught up with and dramatically surpassed their analog predecessors. This has meant rapidly increasing adoption of and migration to IP video surveillance.

Although some industries, such as transportation and education, became early adopters of IP technology, this was not the case in the cost-conscious retail space where end users had been entrenched in analog for decades.

However, more and more retailers are now realizing the benefits of IP video surveillance for reasons that include remote accessibility, better video with broadcast-quality HDTV resolution that provides ever-greater detail for forensic investigations, and intelligent video capabilities with video content analytics (VCA). This has helped to change the way retailers do business by providing additional business intelligence about customer habits and store floor effectiveness while delivering a safer customer experience.

Piggybacking on many innovations born in the consumer market, we’ve seen some amazing advances in IP camera technology that have begun to reshape the way loss prevention professionals approach the challenges of electronic surveillance.

Onboard Storage, Small Systems, and Redundancy One of the reasons retailers are behind other markets when converting to IP video is due to the cost comparison of small systems in the analog space. Many retail outlets require only a few cameras per store, and in the past IP video had a better total cost of ownership only for larger, 32-cameras-or-more systems.

Today, new technology and software combined with onboard storage is making it more appealing for cost-conscious users to move to IP. And as the price of storage continues to drop, users are choosing to retain more video for longer periods of time on their centrally located servers or even onboard the camera or video encoder using SD and microSD memory cards. These SD cards can store from 32GB to 64GB of video, which translates to several days’ worth of video recorded at full frame rate in HDTV-standard 720p resolution.

Greater storage capacity coupled with increased processing power opens a whole new range of possibilities for the surveillance industry, including self-contained solutions. With sufficient capacity to embed the video management system inside the camera, users could avoid the cost of external storage and still remotely access the onboard video directly.

For those concerned about network outages, the market is seeing more offerings for redundancy—even for applications that require high-resolution and real-time recording rates. Cameras now contain the intelligence to detect an outage and automatically begin storing the images in-camera until the connection is reestablished and video can once again be streamed over the network.

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Solutions Showcase Axis Communications Visual Acuity

Often too, there is a need to see images in near darkness. A typical day/night camera will automatically adjust to black-and-white mode, which makes it impossible to identify crucial color details of a scene.

With advancements such as the innovative Lightfinder technology, now users can see color in near darkness. This is especially appropriate when monitoring parking lots, but also for indoor applications when the lights are out.

By utilizing Lightfinder technology, retailers may be able to incorporate green initiatives by powering down electricity during off hours and realizing significant energy savings.

Visual acuity refers to the IP camera’s ability to mimic and, in some cases, surpass the discernment of the human eye. For example, when it comes to field of view, a human’s peripheral vision extends at most from 90 to 120 degrees without moving one’s head. An IP camera’s field of view can extend to 180 degrees and, in more advanced cameras, nearly a full 360 degrees.

Some of the most impactful advancements in visual acuity have been in the areas of resolution, wide dynamic range, and lowlight sensitivity. The adoption of HDTV resolution has increased image quality and, combined with advanced imaging technology, retailers now have much better image usability. With better image usability, evolving advanced analytics have better video data to leverage.

Wide dynamic range (WDR) incorporates techniques for handling a wide range of lighting conditions within a single scene, such as darkly shadowed corners or light streaming through a window or open bay door. Consider the entry/ exit point of a store, with the difficulty of getting quality images due to backlighting and varying degrees of sunlight.

With WDR the camera automatically adjusts to lighting changes, giving you visibility to both foreground and background activities.

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Intelligent Video In the last few years we have seen significant developments with the processing power of camera chipsets and, with memory capacity continuing to expand, intelligent analytics previously relegated to the video management server are now being performed in-camera.

Analysis of video inside a camera (or “at the edge”) gives access to uncompressed video—with all the image details intact—and provides more accurate analytics.

The earliest analytics to migrate to the camera were motion, tampering, and cross-line detection. However, a number of third-party software developers are continuing to add to the in-camera analytics portfolio. In the next phase of video surveillance, the camera will act just like a smartphone where users can download intelligent applications to a device for use with VCA. Axis is currently working closely with analytics partners and even major universities to cultivate more of these applications.

Some of the most readily used analytics for retailers are still in development for edge applications. This has built considerable interest in the benefits of video surveillance for applications beyond security. Cross-functional video means that other departments, such as operations, merchandising, and marketing, can access video and Video Content Analytics to gain business intelligence from heat-mapping and dwell time to out-of-stock alerts and POS integration.

While the above represent some amazing achievements, still more can be done in the retail world. For example, we have very recently seen the launch of a fully-IP covert camera solution with HDTV-quality resolution. As this and other technologies continue to become available, we’ll certainly see higher adoption of digital video within the retail space.

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LPportal.com

Solutions Showcase Nutech National

Alarm Monitoring Conversions Made Easy

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W

e’ve had another burglary!”

As a loss prevention professional, these are the last words you want to hear. In recent years, organized retail crime (ORC) has become a major threat to retail establishments and professionally planned and executed burglaries are on the rise.

Rich Holter recently experienced this fact first hand when he had multiple burglaries within days of one another in his Arizona and California regions.

Holter is the director of loss prevention at Heartland Automotive Services, one of the largest Jiffy Lube franchisees in the country. Over the last several years as incidents decreased, alarm monitoring began to be removed from their budget. When these crimes began reoccurring, it reestablished the need for protection.

As the burglaries progressed, so did Holter’s resolve to stop them. He needed to find an alarm company he could partner with…and fast. This had to be a company

creating additional loss for Jiffy Lube.”

Olinger was able to provide Holter an inexpensive option for turning on his monitoring while keeping his conversion costs low.

With dozens of stores to convert as quickly as possible, Olinger focused on working closely in-house with his service and installation teams to Jesse James Olinger, make sure that these high-risk stores National Retail Director were immediately elevated to the top of the schedule.

“Once our technicians were on-site, we realized that the existing panels and equipment for many of these stores was in bad shape due to it being out of use for several years without the proper servicing,” explains Olinger. “Much of the equipment had to be completely replaced, which raised the cost of the project. Rather than pass this cost on to our customer, we took the loss on our end so that Jiffy Lube could

with a national footprint large enough to meet their needs that could take on this project immediately to prevent additional burglaries from taking place. Most importantly, Holter needed a company that could meet his needs on a limited budget. That left him with very few options until he spoke with NuTech National, who provided the solution he was looking for.

NuTech Responds to a Client’s Critical Need

When NuTech National learned of Holter’s needs, they responded swiftly. NuTech’s National Retail Director, Jesse James Olinger, immediately set out to find a solution for Jiffy Lube.

“When I first received Rich’s call, I could immediately feel his pain,” recalls Olinger. “His stores were getting burglarized almost daily and he needed immediate action.

I provided him with a critical response plan and was able to deliver on-time and within budget. It was a huge success for us knowing that we had stopped those criminals from

realize the true ROI that Rich had presented to the rest of his leadership team. NuTech National believes in building long-term relationships and, if we lose a little money upfront, we’ll gladly make that sacrifice to bring on a great client.”

NuTech’s Multiple Conversion Options

NuTech offers a variety of conversion options: Line Swing. NuTech will have an existing line moved so it reports to their central station. NuTech will then communicate with each panel to make sure that codes and call lists are set up correctly and communicating with the new central station.

This is done at no charge.

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Solutions Showcase nutech National Service after the Conversions

Remote Conversions. NuTech dials directly into the panels and redirects them to the new central station and makes sure the codes and call lists are correct. NuTech can do this because they have a staff of highly trained technical support personnel with an extensive library of download software for most panels made. These are done at no charge.

On-Site Access to the Keypad. While on the phone with NuTech’s technical support staff, a store manager enters a few key strokes on the keypad, which gives NuTech access to the panel so their technical support staff can convert the panel. These are done at no charge.

Service Call to Convert. In some cases a technician has to go to the site and default the panel to allow NuTech to convert it. These visits are done at a fixed price to minimize costs.

NuTech National’s dealer footprint is second to none in the industry with over 3,500 locations.

When a service call is received, NuTech has the ability to respond immediately to a client and can typically have a technician onsite the same day.

NuTech National—“The Nation’s Largest Alarm Servicing Network”— has been providing alarm installation, service, monitoring, CCTV, and card

Panel and Keypad Replacements. Occasionally, a few panels and keypads have to be changed out due to equipment issues and old panels. These are done at a fixed cost to protect the project’s ROI.

Services Used in This Conversion

All new monitoring clients receive NuTechLink, which is NuTech’s real-time, web-based, alarm-management software.

This product can be accessed via the web by personnel at different levels of responsibility and based on level of access.

NuTechLink offers clients the following features: ■U sers are able to view alarm data for sites, such as open/close activity; alarm detail, including operator notes, zones activated, contacts called, and notes from the central station operator; and test timers or alarm test detail.

■ Users can also view, add, delete, or edit codes and call lists.

■ Users can request service.

■ Users can track pending service and installation work orders.

NuTechLink also has some exceptional auto-email-alert capabilities with selectable distribution by report for field and corporate personnel, including: ■ Early/late openings and/or closings, ■ Unauthorized entry outside of normal business hours, and ■ Notification of any fire or police dispatches, which has been a great help in reducing false alarms.

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access to retailers at the national level since the early 1980s. With over 3,500 dealers and 10,000 technicians available, they have tremendous flexibility when it comes to finding technicians, no matter what the need.

NuTech has some of the most competitive pricing in the industry and specializes in the conversion of alarm systems. They offer real-time alarm data and validation of installations with photos, which are hosted on the web for clients on NuTechLink.

NuTech National’s relationships with the major alarm and CCTV vendors provide tremendous flexibility in equipment choices and capabilities for every situation. They also have the download software for conversions and troubleshooting of alarm systems, plus highly trained technical support staff who use this software to help reduce service call costs.

For more information, contact NuTech National at 800-569-1600 extension 1205 or call Jesse James Olinger, National Retail Director at 407-267-1688.

You may also visit www.nutechnational.com.

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LPportal.com

Solutions Showcase Intelligent loss prevention

An Alternative to EAS

Vensafe Post-POS Dispensing System Eliminates Shoplifting and Employee Theft

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etailers in the U.S. lose an average of $95 million to shrink each day. According to the recent report, “Changing Retail, Changing Loss Prevention” by the Centre for Retail Research, 78.2 percent of shrinkage is comprised of theft by customers and employees.

While EAS solutions have long been a standby for retailers, they have their limitations when it comes to putting a serious dent in shoplifting and employee theft.

EAS solutions certainly deter shoplifters, but they can be easily defeated and alarm too late—once a shoplifter hits the exit. Besides, they are labor intensive and handled by multiple employees who have the ability to deactivate the devices and steal merchandise.

Introducing Vensafe

Intelligent Loss Prevention (ILP) is proud to introduce Vensafe, a post-POS dispensing system that prevents loss due to employee theft, shoplifting, and organized retail crime. Vensafe dispenser secures small, high-value merchandise that cannot be retrieved until a shopper completes his transaction at the POS and scans a valid product receipt at the dispenser.

To use Vensafe, all high-value merchandise is moved into the secure Vensafe dispensing unit. Product cards replace actual merchandise at the shelf level. Optional touch-screen kiosks provide additional shopping opportunities.

These freestanding kiosks display an unlimited number of products and can be located anywhere throughout

the store, especially at checkout lanes. Shoppers select merchandise using the touch-screen kiosk, which prints a paper ticket.

Vensafe is easy and convenient for shoppers: 1. Select merchandise using product cards and/or touch-screen kiosks.

2. Pay at checkout and receive an activated Vensafe product receipt.

3. Retrieve merchandise by scanning product receipt at the Vensafe dispenser located between checkout and store exit.

Vensafe Benefits

By limiting product handling to post checkout using an activated product receipt, Vensafe prevents both internal and external theft, even organized retail crime. Small, high-value items, such as razors, skincare, fragrances, medicine, ink cartridges, video games, and family planning items, can’t fall victim to sweep or sweethearting when secured in Vensafe.

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Solutions Showcase Intelligent loss prevention However, Vensafe maintains a simple and convenient “Select, Pay, Retrieve” shopping experience for honest customers. With product cards and/or touch-screen kiosks in multiple locations throughout the store, product exposure actually increases, driving sales.

With Vensafe, stores can eliminate the labor of applying and deactivating various types and sizes of EAS devices or having associates available to unlock security cabinets. With a large capacity, a screen that clearly displays stock levels, and SMS notifications sent when restocking is needed, Vensafe streamlines inventory management.

Unlike traditional vending machines, Vensafe fully integrates with the store’s existing POS system and loyalty programs. Even items that require identification, such as cigarettes, can be used with Vensafe as shoppers must complete their transaction with a cashier at the checkout. Vensafe can reduce customer wait time, staffing, inventory, and floor space typically required for the large tobacco category.

Features of Vensafe

Vensafe offers retailers many features to accommodate a wide range of products: ■C apacity of 80 different product types and 1,600 sale-ready product units.

■ S MS notifications inform associates when restocking is needed.

■D ispenser screen displays stock levels and highlights empty facings.

■M odular facings accommodate a variety of products, sizes, and formats.

■ Vensafe dispenser can be used alone or combined with two extra dispensers.

■O ptional touch-screen kiosk displays an unlimited number of products.

■D ispensers are available with a cooling system.

Vensafe Results

While ILP is currently introducing Vensafe to the U.S. market, Vensafe is already being used in over 5,000 retail locations throughout Europe. Vensafe users have experienced improved profitability and drastically reduced theft. In fact, Danish supermarket chain Kvickly is one of many retailers who have completely eliminated theft of participating products. Store manager Klaus Andersen

remarked, “Both customers and employees have reacted very positively to Vensafe. We now have zero shrink due to theft.”

About ILP

Intelligent Loss Prevention is the consultative security division of Southern Imperial, Inc., a leading manufacturer of retail displays and fixtures for over fifty years. ILP helps brands and retailers safely merchandise high-theft products in shopper-friendly formats that drive sales. From mechanical product protection to RFID-enabled displays, ILP offers multi-level shoplifting prevention solutions. For more information about Vensafe, call Jay Leedy, National Account Manager, at 815-877-7041 Ext. 573.

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LPportal.com

Solutions Showcase Securitech

Trident Offers Retailers the Confidence Their Assets Are Always Protected

T

here are many exit devices and exit locks, but only one—Trident—provides the highest level of forced-entry protection and code compliance with steel bolts projecting into the frame. The Securitech Trident is designed to keep merchandise inside the store and burglars out.

Since its introduction in 2005, the Trident system has evolved into a powerful solution both in terms of its ability to prevent attacks and the features it offers the end user. Trident is designed with the local authority having jurisdiction and code compliancy in mind. The many benefits of the Trident can be broken down into three categories: ■ Forced-entry protection, ■E asy installation, and ■ Maintenance-free operation.

users, it may only take an hour. With the patent-pending, full-size steel template, the installer is able to mark and drill without measuring.

The Trident lock is factory assembled and doesn’t use unreliable connecting rods. Simple features like optional plug-in alarms and swap-out extended paddles provide the ability to add additional options with ease. The Trident is also neither handed nor sized, making a door survey not required before ordering.

Maintenance-Free Operation

Maintenance-free operation is something everyone takes into consideration when replacing or installing new exit hardware. The Trident, unlike other exit devices, does not bolt into the floor. We found that when exit devices bolt into the floor, you run into locking problems due to dirt and moisture buildup. But when you bolt into the

Forced-Entry Protection

The Trident has superior protection against prying by using locking bolts at all major pry points. The bolts project into the frame at three points on the lock side and one (standard) on the hinge side. Up to six bolts are possible by adding additional hinge-side bolts. Four locking points provide the perfect amount of security, but Securitech is always willing to meet any needs with additional bolts. The Tridents bolts provide a full inch projection at all points and are free spinning to prevent from cutting.

New to the Trident line is our delayed-egress unit, which can hold the door for a period of time to prevent grab-and-go theft. The time is programmable so that each unit will comply with the local code, while also stopping grab-and-go theft.

The Trident line always continues to innovate.

Ease of Installation

The ease of installation is one of the most important factors when our customers choose the Trident. Using a revolutionary design, the Trident can be installed in under two hours. And in the case of installations by previous

frame, the door is always guaranteed to close correctly.

This helps eliminate situations like rear entrances left unsecured or employees forcing doors closed causing the lock to break down over time. All the moving parts of the Trident are protected using aluminum channels, ensuring smooth locking at all times. The maintenance-free operation that comes with the Trident line is truly unbeatable, giving retailers the confidence their assets are always protected.

Simply the Best

In the end it comes down to the continual approval from locksmiths, fire marshals, and LP directors.

Locksmiths love the bolting into the frame, not to mention the easy installation. Fire marshals love the single-motion exiting that comes with all Trident models, giving code compliancy and safety to all locations. LP directors, well, they simply want the best security for their locations, and with automatic locking each time the door closes, they are assured their buildings are safe and secure.

The Trident line always provides forced-entry protection, ease of installation, and maintenance-free operation. That why retailers choose Trident—because it is “Simply the Best.”

LP Magazine | May - June 2013

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Solutions Showcase Palmer, Reifler & Associates

Litigation’s Role in the Civil Recovery Process

By Natt Reifler and Marisa C. McIntyre

Law Offices of Palmer, Reifler & Associates, P.A. is a law firm focused on civil recovery law, representing clients internationally. The Firm regularly files lawsuits against theft offenders on behalf of its retail clients as an integral part of its legal representation. This article, coauthored by Natt Reifler and Marisa C. McIntyre, provides a brief overview of the relationship between litigation and civil recovery.

C

ourts encourage out-of-court settlements, making it clear that courts either expect or contemplate that victims of theft will likely attempt to resolve their disputes with theft offenders via demand letters before ever filing suit. In fact, some statutes require that a demand letter be sent offering to settle a civil claim before a suit can be filed. Parties are encouraged to attempt to work out their disputes on their own before involving the legal system in a more formal way. However, while demand letters can be very effective, saving both time and money, they do not always produce a settlement.

This is where litigation comes into play. Whether a loss has been caused by an ex-employee or a shoplifter and whether or not a promissory note has been signed or a written admission statement given, the retailer that has nonetheless suffered a legal injury and/or loss has the right to pursue a civil claim pursuant to the relevant state’s statute. The case may not end up going to court; it may be resolved through sending certified letters or through another alternative dispute-resolution procedure, such as mediation. However, sometimes a suit needs to be filed to get the opposing party to seriously contemplate a resolution.

While some may find the litigation process intimidating, there are definite advantages to filing suit. Some statutes allow retailers to recover higher amounts in court than retailers typically request in their pre-suit settlement demands.

For example, several statutes allow for the recovery of treble damages (three times the damages) or a wide range of additional or exemplary damages, and many statutes

allow for the recovery of court costs and attorney’s fees for the prevailing party. Once a suit has been filed, whether or not the opposing party contests the matter, if successful, a civil judgment will typically be ordered. At that point, the defendant is in a much weaker bargaining position and would be subject to post-judgment remedies designed to help the prevailing plaintiff recover its damages and costs.

Civil recovery is an important tool for the retail industry, helping retailers recoup a small portion of the incredible loss caused by theft shrink, while preventing these costs from being transferred to honest consumers through higher merchandise prices. Statutory civil penalties are also used as a deterrent to cause people in general to think twice before committing theft and to decrease the likelihood that those caught will repeat their wrongful acts. If a demand letter does not produce a resolution, litigation is simply the next natural step in the process of resolving the civil matter and holding theft offenders accountable. The more offenders that are held accountable, the better the chance of combating the billion-dollar problem of theft.

NATT REIFLER, Esq. is a partner at Palmer, Reifler & Associates.

His responsibilities include the overall supervision of the legal department and the team of dedicated collectors. Reifler also consults on compliance issues, serves as a legal liaison to clients, and advises on the firm’s day-to-day activities.

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MARISA C. MCINTYRE, Esq. is an associate attorney with Palmer, Reifler & Associates.

Her responsibilities include representing clients in structuring and negotiating settlements in mediation and in small claims court.

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LPportal.com

THIS IS SECURITY’S MUST-ATTEND EVENT!

Forward-thinking executives, private sector and government professionals, and new-to-the-industry practitioners looking for more security knowledge need only to attend ASIS 2013, the world’s most influential security event.

From visionary and motivational speakers to more than 200 educational sessions to certification programs and more—the intelligence, ideas, and insight you’re searching for can all be found in one place, at one time.

ASIS 2013 is a smart experience for you and your career. Around the clock learning opportunities start with all-day demonstrations in the Exhibit Hall and continue into the evening with networking events. When you’re ready to take security to the next level, visit the event that’s already there.

Admission to the Exhibits is FREE when you register in advance!

WEDNESDAY KEYNOTE

THURSDAY KEYNOTE

FRIDAY LUNCHEON SPEAKER

STEVE WOZNIAK

JOHN HOWARD

MIKE DITKA

www.asis2013.org

Certification

Evolving Attitudes toward Education

by Gene Smith, LPC Smith is president of The Loss Prevention Foundation, the not-for-profit organization charged with the responsibility of managing certification. He was formerly president of the industry’s largest executive search and consulting firm. During the past fifteen-plus years, Smith has provided career counseling for thousands of industry professionals nationwide. He can be reached at 704-837-2521 or via email at gene.smith@losspreventionfoundation.org.

senior executives running large loss prevention organizations who go back to college to finish a degree or seek a higher one. Despite how busy LP executives are, they find the time for university study because it is that important to them.

While I have spoken passionately over the years for the need to embrace higher education, I have always respected anyone who has climbed the career ladder without it. Some of our most successful industry-leading professionals have no degree. However, those who don’t still recommend that others should get one, and I can assure you they all have encouraged their kids to get one. Why?

Many of us remember when we only had the National Retail Security Survey, produced by Dr. Richard Hollinger of the University of Florida, and the National Association for Shoplifting Prevention (NASP) as professional resources.

It wasn’t long ago that our industry had no LP-specific magazine, with only broad security magazines that occasionally mentioned the term loss prevention in an article.

We had no academically accredited research, such as what Dr. Read Hayes and the LPRC have provided in recent years. We were still transitioning from retail security to loss prevention and still very focused on apprehensions and investigations.

Educational Resources in LP

Certification is not a substitute for a degree, and a degree is not a substitute for professional certification. There is a reason why most reputable professions embrace both. They truly complement each other.

Most would agree that our industry has changed and evolved for the better. We now have professional resources, such as LP Magazine, LP Foundation, and LPRC, that other professions have had for years. We now have degrees that are industry-specific from several universities.

And certification, once just a vision by a handful of forward-looking LP executives, is fast becoming a standard in loss prevention like other professions.

Human resources and internal audit have had certification for years. Teachers must have degrees as well as certification as do financial planners, insurance agents, realtors, accountants, fraud investigators, and safety and risk professionals. Why, after receiving a bachelor’s degree and often a master’s degree, do these professionals still have to be certified?

Certification is not a substitute for a degree, and a degree is not a substitute for professional certification.

There is a reason why most reputable professions embrace both. They truly complement each other.

If we want to continue to elevate our profession to the level of our peer professions, we must embrace the common place of college graduates entering our profession in higher numbers than in the past. We must support professional certifications like the LPQ, LPC, CFI, and CFE. We must encourage our working professionals to enroll in traditional college or convenient online courses.

Attitudes toward educational degrees and professional certifications have changed rapidly in recent years. The LP Foundation has worked with several institutions who have launched or are about to launch industry-specific programs. Most recently the LPQ and LPC certifications

this industry has to offer.

Many of us also remember when the only certification remotely related to the private sector was the certified protection professional (CPP), a broad security-focused one.

Then, finally, Wicklander-Zulawski & Associates created the certified forensic investigator (CFI) certification that addressed a very important skill set—interviewing and interrogation.

It was not that long ago that most companies seldom asked for a college degree as a preferred requirement. If they did ask, it was likely a criminal-justice degree; never a business or finance degree.

Those of us who have studied the educational needs of our profession for years have admired and respected two types of executives. There are those executives who have ascended to the highest levels without a formal college degree. However, after you interview them, you see they clearly have a degree from the “College of Hard Knocks,” which is very valuable. Equally impressive are the many

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have been granted academic credit toward a degree with one of the largest online universities in the world—the American Military University. This accomplishment would not be possible unless the developmental process was solid, the course content of high quality, and the exam psychometrically sound.

Loss prevention certification has made tremendous progress since its inception. Consider these statistics: ■ 223

different companies now have at least one employee certified.

■ 134 companies have LPC-credentialed employees.

■ 134 companies have LPQ-credentialed employees.

■ 429

companies have employees working on LPQ or LPC certification.

■7 5 companies now hold LPQ or LPC as a preferred requirement.

■8 of retail’s top ten companies have LPC certified employees.

■ 21 VPs and 56 directors are LPC certified.

■ 1,400

U.S. and 5,000 worldwide locations offer the LPQ and LPC exam.

■ American Military University, Eastern Kentucky University, and Fairleigh Dickinson offer credits for LPQ and LPC certification.

The Gift of Education

Personally, I always believed one of the greatest gifts any parent could give their children was a good education. As a working adult, one of the greatest gifts you could give yourself was the gift of continued education. That education is best when obtained from both an accredited college and from the “College of Hard Knocks.” Professional certification is just another quality educational resource that not only confirms the understanding of core competencies, but also provides industry-specific information that professionals can apply to their present positions.

A vice president of LP once told me he was concerned about paying for certification or a college degree for his people because he was afraid his people would leave him and go to another company after they were educated. I told him something I had read once—the only thing worse than paying for their education and having them leave, was not paying for their education and having them stay.

Newly Certified

Following are individuals who recently earned their LPC and LPQ certifications.

Recent LPC Recipients

Leo Anguiano, LPC, Rite Aid Daniel Barnes, LPC, Streamwood Police Department Deb Brown, LPC, 7-Eleven LaRoy Carff, LPC, DICK’s Sporting Goods Doug Carter, LPC, easyhome Jih-Hao Jim Cheng, LPC, DICK’s Sporting Goods James Deese, LPC, Rite Aid Paul Feiner, LPC, City Market, Onion River Co-op Tim Flowers, LPC, Best Buy Jennifer Fogarty, LPC, Walgreens

Kevin Foote, LPC, Staples Charlotte Gandon, LPC, Majid Al Futtaim Retail James Hawkins, LPC, Sears Holdings Chris Hawthorne, LPC, Brookshire’s Food Stores Tony Hentges, LPC, T-Mobile USA Sandra Hinson, LPC, Lowe’s Mike Kimbrough, LPC, DICK’s Sporting Goods Darrell Kingore, LPC, Walgreens Tyrone Macon, LPC, TJX Justin Maiorana, LPC, Harris Teeter Michael Mann, LPC, Macy’s Logistics and Operations Kenneth Matheson, LPC, BJ’s Wholesale Club Patricia McDonald, LPC, Big Y Thomas Nelson, LPC, Nelson Investigations and Loss Control James Nelson, LPC, Office Depot Jack Pendergast, LPC Daniel Reeves, LPC, TJX Daniel Rhatigan, LPC, The Home Depot Kenneth Ridolfi, LPC, Walgreens David Roberts, LPC, Lowe’s Chris Scheutzow, LPC, Bed, Bath & Beyond Howard Schwartz, LPC, Staples Micah Seal, LPC, Brookshire’s Food Stores Thomas Sevcik, LPC, Rite Aid Tony Sheppard, LPC, CVS Caremark Rick St. James, LPC, Wegmans Eric Stahmann, LPC, Walgreens Matt Taylor, LPC, Walgreens Paul Templeman, LPC, Z Gallery William Van Hoose, LPC, Walgreens Erik Van Wagner, LPC, Kroger’s Annette Wall, LPC, REI Angela Wilkerson, LPC, Beall’s Dustin Hudgins, LPC, CFI, Rent-A-Center Michael Korso, LPC, CFI, Ascena Retail Group Jose Lopez, LPC, CFI, T-Mobile USA

Recent LPQ Recipients

Cami Beckerdite, LPQ, Orchard Supply Hardware Miguel Bonilla-Roman, LPQ, U.S. Navy Matthew Boyle, LPQ, Michaels Stores Vicki Burnette, LPQ, MRCO, LLC Casey Carroll, LPQ, Cabela’s Ian Garrett, LPQ, Sports Authority Andrew Gourley, LPQ, Walmart Katherine Houston, LPQ, Contact Justin Kemp, LPQ, Contact Bryan Knepper, LPQ, Vector Security Services Rory MacDonald, LPQ, Walmart Amber Manion, LPQ, Ascena Retail Group Ryan Mason, LPQ, Shelburne Museum Jason Maurice, LPQ, Kraft Foods Wade Moeller, LPQ, Publix Super Markets Roger Moore, LPQ, Weis Markets Julie Morris, LPQ, Lowe’s Joseph O’Brien Jr., LPQ, Target Dalida Omerovic, LPQ, lululemon athletica Michael Osborne, LPQ, The Northwest Company Brian Palmer, LPQ, Genesco Trevor Pfeifer, LPQ, Federated Co-operatives Limited Cynthia Ramos, LPQ, Michaels Stores Joshua Salthouse, LPQ, Walmart Antonio Salzedo, LPQ, AT&T Kevin Shultz, LPQ, Publix Super Markets Amber Virgillo, LPQ, Contact Ryan West, LPQ, The Home Depot Christopher Whitton, LPQ, Cabela’s Laura Zane, LPQ, Rite Aid Santo Zenone, LPQ, Gap

LP Magazine | May - June 2013

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Industry News

by Robert L. DiLonardo DiLonardo is a well-known authority on the electronic article surveillance business, the cost justification of security products and services, and retail accounting. He is the principal of Retail Consulting Partners, LLC (www.retailconsultingllc.com), a firm that provides strategic and tactical guidance in retail security equipment procurement.

DiLonardo can be reached at 727-709-6961 or by email at rdilonar@tampabay.rr.com.

Checkpoint Exits the Video Business

C

transition to its new owner and to run the company going forward. Before leaving Checkpoint in late 2011, Khalil served in a number of high-level positions over a sixteen-year period, including president of its North American business unit.

Platinum Equity is a global mergers and acquisitions company with almost $3.5 billion in commitments in its two private-equity funds. The company’s current portfolio includes over thirty companies in a wide range of business segments, including industrials, manufacturing, logistics, entertainment, and hospitality.

“We are excited about the prospects for CheckView under our ownership,” said Platinum Equity Principal Jason Leach. “Platinum has an extensive track record of acquiring corporate divestitures and maximizing their potential as stand-alone businesses. CheckView will act as a platform acquisition and allow us to focus on the core business, while pursuing organic growth initiatives and strategic add-ons in a highly fragmented space.”

In a related transaction, Checkpoint sold its Banking Security Systems Integration business in October 2012 for $3.5 million. This unit was a subset of CheckView.

Financial results for fiscal 2012 were also reclassified as discontinued operations. The unit reported annual revenue of about $10.75 million and a loss of a little over $3.0 million.

These two divestitures reflect a redefining of Checkpoint’s strategy in 2012 geared toward providing EAS and RFID solutions to help retailers improve merchandise availability in their stores. The company’s board of directors concluded that the CheckView and banking businesses were no longer in line with the company’s new direction.

The sales are part of a three-tiered global restructuring plan that Checkpoint has been undertaking since 2009. The major objectives are to “stabilize sales, manage margins, dramatically reduce operating expenses, more effectively manage working capital, and improve global cash management control.”

Total savings are expected to exceed $100 million by the end of fiscal 2013.

Checkpoint’s total revenue for the fiscal year, ending December 30, 2012, was $690.8 million, a drop of about 9.5 percent year-over-year.

heckpoint Systems, a global leader in retail security and merchandise availability, announced in late March that its U.S. and Canadian CheckView video, intrusion, and fire/safety business will be sold to an affiliate of Platinum Equity, a California-based private equity firm.

The $5.4 million cash transaction, which is scheduled to close by the end of April, includes the use of the CheckView name, all continuing operations, and assets associated with the U.S. and Canadian business. Assets include a central station service that provides CheckView’s customers with the only 24/7 monitoring dedicated strictly to the retail industry.

In addition, about 225 current employees are expected to continue with the business following the transaction’s closing.

The sales are part of a three-tiered global restructuring plan that Checkpoint has been undertaking since 2009.

The major objectives are to “stabilize sales, manage margins, dramatically reduce operating expenses, more effectively manage working capital, and improve global cash management control.”

Total savings are expected to exceed $100 million by the end of fiscal 2013.

The company will be based out of its current location in Chanhassen, Minnesota. CheckView’s recently reported fiscal year 2012 financial results were reclassified as discontinued operations. Annual revenue was $76.5 million, a drop of over 24 percent year-over-year.

Checkpoint recently rehired industry veteran Nicholas J. Khalil as the president of CheckView to oversee the

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People on the move

Jim Passarella has been promoted to Director of AP, East, and Mike Suppe to Director of AP, West, for 7-Eleven.

Aaron Rogers has been promoted to Director of Field Risk Services at Axcess Financial.

Rod Lewis has been appointed Senior Corporate Investigator for Barnes & Noble.

Samuel Edge has been appointed Regional Director of LP for Barney’s of New York.

Paul R. Fisher has been appointed VP of Sales and Marketing for Bass Security.

Marlene Kusumoto has been appointed Director of LP for Charlotte Russe.

Joe Gibney has been appointed Regional LP Manager for Chico’s FAS. CVS announced the following changes: Don Kimberlin to Regional LP Manager; Shelly Grant to Manager of LP Applications; Karlyn Scott to Director, LP Budget and Forecast; Darlene Cobain to Senior Director of LP Analytics; and Kevin Plante, LPC to Director, LP Reporting and Analytics.

Amanda Swain has been promoted to LP Specialist for Dillard Security Services.

Duane Stewart, CFI, LPC has been promoted to Regional LP Manager for Dollar General.

Jordan Rivchun has been promoted to Corporate Manager of Investigations, and Jim Mires to VP of LP for DSW. J Michael Anderson, CFI has been appointed Regional LP Manager for GNC. Jason Lee has been promoted to Senior Managerof LP for Gymboree.

Danny King has been appointed AP Manager, Supply Chain, for The Home Depot.

Dan Hannula has been appointed Director of LP and Safety for L&M Fleet Supply Stores.

John Harden has been promoted to Senior Director of Sales, U.S. and Canada, for Langhong Technology USA. Patty Ishmael has been appointed Regional LP Manager for Limited Brands.

Robert Ruiz and Daniel Cruz have been promoted to Regional Directors of AP and Jonathan Shimp to VP of AP for Louis Vuitton.

Mike Ward has been appointed Director of LP for Lumber Liquidators.

Sam Breezee has been named LP Investigator for Lund Food Holdings.

Terry Nichols, LPC has been promoted to VP of LP/Safety, and Walt Hall to Director of LP/Safety for Office Depot.

Keith Harmon, LPC has been promoted to Director of Field Investigations and Major Crimes for Rite Aid.

Jennifer Gilmore has been named Market Investigator for Ross Stores.

Dan Horowitz has been promoted to Director of LP for rue21.

Daniel Couillard has been appointed National Sales Manager and Dan Ireland Regional Sales Manager for Samsung Canada.

Art Mercer has been named Regional LP Manager for Sears Holdings.

Bob Brokaw has been promoted to Senior Director of AP for SUPERVALU. William Malson has been appointed Regional LP Manager for T-Mobile.

TJX Companies have announced the following changes: Eric Hebert to District LP Manager; Daniel Reeves, LPC to ORC Investigator; Ken Karch to Manager of National Investigations, National Task Force; and Brian Smitherman to District LP Manager.

Bill Farris has been promoted to Zone Director of LP for Victoria’s Secret Stores.

Bill Turner has been named VP Customer Relations and Scott St. Clair has been promoted to Southeast Regional Sales Director for Universal Surveillance Systems.

Marty Andrews has been promoted to Director of LP and Risk Management for Vans, Splendid, Ella Moss, and 7 For All Mankind.

Steven White has been appointed Senior Director of Technology, National Accounts Division, for Vector Security.

Shawn Norris has been named Regional LP Manager for The Vitamin Shoppe.

Fred Hassel has been appointed AP Manager, Supply Chain Integrity, for Walgreens.

Chris Harris has been promoted to Director of AP for Weis Markets.

Dennis Gandy has been appointed Director of LP for Wolverine Worldwide.

Linda Schuch has been named Regional LP Manager for Z-Gallerie.

To stay up-to-date on the latest career moves as they happen, sign up for LP Insider, the magazine’s weekly e-newsletter, or visit the People on the Move page on the magazine’s website, LPportal.com.

Information for People on the Move is provided by the Loss Prevention Foundation, Loss Prevention Recruiters, Jennings Executive Recruiting, and readers like you.To inform us of a promotion or new hire, email us at peopleonthemove@LPportal.com.

LP Magazine | May - June 2013

Calendar

May 8 – 10, 2013 International Organization of Black Security Executives Annual Spring Conference Hosted by Limited Brands Columbus, OH www.iobse.com June 4 – 5, 2013 Retail Council of Canada Evolution of Retail Toronto (ON) Congress Centre www.storeconference.ca June 12 – 14, 2013 National Retail Federation Loss Prevention Conference & EXPO San Diego (CA) Convention Center www.nrf.com June 23 – 28, 2013 Association of Certified Fraud Examiners 24th Annual Global Fraud Conference Aria Resort & Casino, Las Vegas, NV www.fraudconference.com August 4 – 7, 2013 National Food Service Security Council 34th Annual Conference M Resort Spa and Casino, Las Vegas, NV www.nfssc.com September 24 – 27, 2013 ASIS International 59th Annual Seminar and Exhibits McCormick Place, Chicago, IL www.asisonline.org October 15 – 17, 2013 Loss Prevention Research Council 9th Annual Impact Workshop University of Florida, Gainesville www.lpresearch.org November 20 – 21, 2013 ISC East 2013 Javits Center North, New York www.isceast.com January 12 – 15, 2014 National Retail Federation 103rd Annual Convention & Expo Jacob Javits Convention Center, New York www.bigshow14.com March 9 – 12, 2014 Food Marketing Institute 2014 Asset Protection Conference Hyatt Regency Riverfront Hotel, Jacksonville, FL www.fmi.org

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73

Parting Words

Never, I Mean Never, Has It Been Better

Jim Lee, LPC Executive Editor

I

It is critical to have mentors and to become one yourself.

Disposition matters, be optimistic.

These three executives are perfect examples of the title of this column. Never, and I mean never, has retail loss prevention been consumed with so many bright, passionate, dedicated professionals.

just returned from the Retail Industry Leaders Association Asset Protection Conference. As with every conference I attend, a highlight is always the keynote presentation. Often it is a C-level retail executive, a successful business person, a motivational speaker, or a sports legend. Each in their own way is interesting, and their accomplishments are admirable. All of them try to relate their message to the world of retail loss prevention.

Some succeed. But, I rarely walk away saying to myself, “Wow, what a person.”

■ ■

LP in the Boardroom

Now wait a minute, hold your horses. I have seen it in print and heard it said publically that loss prevention is losing jobs; that LP executives are not doing as good a job in the boardroom with C-level folks as in the past. Granted, there are companies that go through challenging times, with cuts and downsizing. It takes place across that company, not exclusively in LP. And we have seen companies go out of business and many jobs of all kinds have been lost. At the same time, many other companies have added jobs, and new companies have surfaced creating many LP jobs.

Now I ask you, do you have any openings in your company?

All levels? I submit to you that when it comes to jobs, we are in need of people to fill the openings. In the past we would get up on our soap box and speak about the LP person who crossed over to stores or operations and became a C-level executive.

Those are wonderful achievements by those individuals, and they point out the work values gained from the LP experience.

Conversely, for many years companies have been reaching into the stores, operations, administration, and merchant ranks to move individuals into LP positions. We have not given those companies or those people their deserved due. In fact, two of the LP executives I mentioned in this column came from stores and operations. Many companies have seen the value of moving bright, passionate people into LP. That happens because the company sees the value that the loss prevention function brings to the bottom line.

As for the statement that LP executives are not doing as good a job in the boardroom, look around at all the directors, VPs, and SVPs that exist today. Look at the innovations made in data, analytics, and technology. The C-level knows that the LP and asset protection departments today are profit enhancers and every bit as vital to the success of their company as any other function. Never, I mean never, have times been better for the loss prevention community.

Four-Star General

Those in attendance were honored with a keynote from General Ann Dunwoody, who recently retired from the U.S. Army after 38 years with the rank of four-star general—the first woman ever to achieve such a distinction.

That achievement puts her in the same class with other four stars, like Washington, Grant, Sherman, Pershing, MacArthur, Eisenhower, Bradley, Patton, Schwarzkopf, and Powell. In our military history only 206 have worn the four stars. General Dunwoody delivered a message on leadership.

Her beliefs are best reflected in the following statement: “Stick to your principles and have the courage to do what you believe in. When you run into resistance, you can either give up and let the bureaucracy win, or you can fight the bureaucracy.

And that takes a lot of personal energy and intellect. To change is not easy, and sometimes it requires change to do the right thing for the right reason.”

How do you think she did relating her message to the world of loss prevention?

How I Got Promoted

There was another session that deserved the wow factor.

Michelle Jennings of jcpenney, David Neisen of PetSmart, and Monique Sorrell of AutoZone—each LP executives in their respective companies—spoke on the theme, “I Just Got Promoted; Here’s How I Did It.” Each spoke about pieces of their journey, their sacrifices, commitments, and passion for loss prevention.

Here are some of the excerpts from Jennings, Neisen, and Sorrell.

■ Leverage your strengths, build off your weaknesses.

■ Volunteer.

■ Humility plays a role in your development.

■ Always be looking forward.

■ Senior leadership is willing to help those who ask for help.

■ Learn about three areas of your company outside of LP. ■ Seek certifications.

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